Headcount shrinks at Alliance Trust
Alliance Trust's high-profile poaching of SWIP's fixed income managers last year may have been the limit of the Scottish firm's appetite to hire - overall headcount fell in 2009.
Although the Dundee-based investment group revealed a profit in its latest annual report - posting a profit 473m for 2009, compared with a loss of 517m in 2008 - performance was still below par. Its net asset value rose by just 19.2%, meaning it ranked 34th out of 43 rival funds.
Not surprisingly, in spite of establishing a new fixed income team last year, overall headcount was down by 14%, to fewer than 300 staff. "Some tough short-term decisions were made, where deemed necessary for longer term gains," it said.
In fact, the firm's reinvestment in equities drove its better performance in the second half of last year. Much of this was in Europe and Asia, as the firm's fund managers were wary of the precarious fiscal and political climate in the UK, and a hefty 95% of its assets are now in listed equities, compared to 77% at the beginning of 2009.
But the recruitment of Rod Davidson, Gareth Quantrill, Stuart McMaster and Stuart Stevenson from SWIP last year for a new fixed income team aims to reduce its reliance on equity investments for income.
Reuters reports that Alliance Trust is set to launch a mainly UK-focused corporate bond fund in the next two to three months, as well as shifting its equity exposure towards Asia.
Overall, the bonus pool shrank last year - Alliance Trust allocated 1.1m for its senior management equity incentive plan and long term incentive plan, down from 1.6m in 2008.
It did, however, make some senior hires in its pensions administration subsidiary, Alliance Trust Savings, which it says has a "stronger focus on customer service and value."
