Franklin Resources Grapples With Persistent Outflows Despite Record AUM

Global asset manager Franklin Resources finds itself in a familiar industry predicament: client funds are exiting even as rising markets push its assets under management to unprecedented levels. The firm’s preliminary August AUM of $1.64 trillion, up from $1.62 trillion the previous month, masks a more troubling underlying trend of substantial net outflows.

A significant long-term net outflow of $3 billion was largely concealed by positive market performance. The majority of this capital movement was attributed to the departure of a single fixed-income mandate worth $6 billion.

The firm’s subsidiary, Western Asset Management, proved particularly burdensome to overall results, reporting net outflows of $7 billion. Excluding this segment, the parent company would have actually recorded net inflows of $4 billion. One bright spot emerged from the cash management division, which Read more...