Dexia reports slump in SRI sales

New business falls despite market pick up.

Dexia Asset Management has reported a 120% decline in net sales of socially responsible investing (SRI) funds and segregated mandates under management for 2009 compared to 2008.
The firm’s SRI assets under management were in the red at -€99m for 2009 (excluding market effects), compared to €496m of sales in 2008, according to the Dexia Group’s new 2009 sustainable development performance indicators report. The manager took in new SRI business of €3bn in 2007.
When market rises were added total SRI assets under management rose by 12% to €18bn at the end of 2009 against €16bn at the end of 2008. Dexia said funds managed for institutional clients were up over the year, but offset by withdrawals from private investors.
Brussels-based Dexia added that its share of the European SRI market had declined to 5.6% – down from a peak of 8% in 2006 – partly due to a large number of new players entering the market in 2009.
In January this year the €29bn French pensions reserve fund (FRR) terminated Dexia from a European SRIequities mandate estimated at more than €100m due to poor performance. In March, Dexia AM named Isabelle Cabie as its new head of sustainable and responsible investment following the departure of former head, Gaëtan Herinckx.
Meanwhile, Dexia’s funding of renewable energy also fell in 2009. It funded such projects to the tune of €461 last year, down from €1.4bn and €817m in 2007 and 2008. It said the figures needed to be “placed in the context” of the financial crisis. Its share of the global renewable energy funding market has slipped to 3.6% from 9% in 2007.
Governments in Belgium, France and Luxembourg had to step in to rescue Dexia, the fund manager’s parent bank, injecting almost €6.4bn into the business to keep it afloat at the height of the credit crisis.
Dexia’s 22 strong SRI team, one of the world’s largest, has input into 8.9% of Dexia’s total funds business through 24 SRI funds.
Link to Dexia Sustainable Development Performance Indicators