Lloyds forecloses

The Lloyds Banking Group mandate which represents a fifth of Standard Life Aberdeen’s Assets, which had already fallen from £670bn to £646bn after a wave of investment redemptions despite record equity prices. Last year’s £11bn takeover of Aberdeen Asset Management by Standard Life, experienced a collapse after the UK’s biggest fund managers lost its biggest client and a £109bn investment contract.

They received notice terminating the Lloyds mandate which is greater than the entire assets under management at Man Group, the UK’s third-largest listed asset manager.

Martin Gilbert the CEO of the enlarged group alongside Keith Skeoch, his Standard Life counterpart said “ We are confident in Standard Life Aberdeen’s future and concerns that the business was going into reverse were laughable. We are obviously disappointed we didn’t reach the agreement, as they are clearly an important client.”

Standard Life Aberdeen’s shares fell by 7.5 per cent. Aberdeen  gained the right to manage the assets when it acquired  Scottish Widows Investment Partnership from Lloyds in 2014, with Lloyds retaining the right to terminate the contract if Aberdeen merged with a competitor. Standard Life Aberdeen said it would take a £40m charge related to the contract with Lloyds, which has given 12 months’ notice to end the partnership.

Standard Life Aberdeen suffered large redemptions by investors that made it one of Europe’s worst selling asset management houses in 2017.