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Allianz Global Investors (GI) is shutting its fixed-income securities lending business less than a year after deciding to go-it-alone with its own in-house programme.
The German investment management and insurance firm will close its securities lending desk in London by the end of 2020, having only started to build it out in late last year.
An AllianzGI spokesperson tells SLT that the decision was made in order to focus its attention on “where we believe we can add the most value for our clients”.
The spokesperson was unable to comment on the future movements of AllianzGI’s four-strong securities lending team led by Rory O’Connor.
In November 2019, the firm informed clients it would seek to commence securities lending in relation to fixed income securities held in the companies’ sub-funds within the next six months, with plans to expand into equity lending down the road.
Previously, AllianzGI said it ran a “modest” securities lending programme via an unnamed agent lender.
The move to now wind down the business comes as part of a “comprehensive strategy review” aimed at allowing AllianzGI to “anticipate clients’ future needs while building on core strengths”.
As part of the global review, all existing business lines and products were put on notice but currently, the only business to be axed entirely in the UK is the securities lending desk.
The review is on-going and streamlining and tweaks to other business lines and products are expected but further details are currently unavailable.
Actions already taken this year by AllianzGI include the creation of an “integrated, global set-up for fixed income” and a “strategic partnership” with Virtus Investment Partners to address the US retail market more effectively.
Elsewhere, the firm says it continues to build out its private markets capabilities, including infrastructure debt and equity, private debt and private equity.
Other changes at AllianzGI include key changes at the top with Andreas Utermann set to be replaced as CEO by Tobias Pross, currently global head of distribution, as part of a succession plan as of 1 January 2020. Meanwhile, global head of alternatives Deborah Zurkow is also primed to take over global head of investments.
Commenting on the succession, Utermann says: “Leaving AllianzGI will not be easy. Having had the opportunity to work alongside so many talented and engaging people, to develop and lead a strong team and to build a respected global investment business, is a source of great pride.
“It is therefore comforting to be able to pass on the leadership of the firm to Tobias and Deborah, both of whom have the energy, insight and values to develop further AllianzGI’s offering and reputation.”
