Aviva exits Australia, shutters fund

Aviva Investors is shuttering its Australian office and moving operations offshore as it also terminates its strategy, the Multi-Strategy (AIMS) Target Return Fund.

Aviva told investors that it has "recently made the decision to close the investment manager's offices in Australia and exit the Australian retail market."

The confirmation follows the Australian managing director Brett Jackson departing the fund manager, announcing it is now managing distribution from Singapore.

A spokesperson for Aviva Investors said it is making changes to its distribution model in the Asia Pacific to better support its growth initiatives in the region, as reported by sister publication Industry Moves, centralising insurance solutions, institutional, and global wealth in Singapore.

"As a result of these changes, Aviva Investors will be exiting its domestic Australian retail fund distribution operation and realigning Australia and New Zealand distribution to Singapore, where we will continue to provide coverage to the important local institutional markets, with a focus on expanding our offshore fund strategies and segregated mandates," the spokesperson said.

The Aviva Investors Multi-Strategy (AIMS) Target Return Fund, a unit trust that was only nine years old, launching in Australia in 2015, has been terminated following poor performance and lack of investor interest. It had a minimum investment amount of $500,000.

Perpetual's The Trust Company, as the Responsible Entity (RE) of the fund, decided to shutter the fund on June 12 as it did not meet its long-term performance objective. Since inception, the fund returned 4.06% gross of fees at the end of May, while its benchmark returned 6.60%.

It also meant that Aviva Investors Pacific as its investment manager "has not raised sufficient assets to make the fund viable, particularly in terms of investment and operating cost efficiencies," the RE said.

"In addition, there has been a significant redemption which has dramatically reduced the size of the fund and therefore further affected its viability."

The fund was managed by Peter Fitzgerald and Ian Pizer, who are based in London.

The fund only had $154.5 million in funds under management, which was just a fraction of what it had in 2018 of about $723 million.