Franklin Templeton, the US fund manager that invested heavily in Irish bonds last year, has tumbled out of a list of the top-30 best-selling investment funds in Europe a year after it came first in the same ranking.
The US company has lost the number-one spot to bond fund manager Pimco, which becomes Europe’s best-selling fund company on an international basis, according to data provider Lipper.
Ed Moisson, head of cross-border fund research at Lipper, said two of Franklin’s best-selling global bond funds in 2011 “went through a patch [in 2012] where there was a bit of a downturn on performance”.
He said that despite a perception that the performance of the Templeton Global Bond and Templeton Total Return funds had “come off the boil”, returns for the whole of 2012 were still good.
The funds are both managed by Michael Hasenstab, who has predicted that the turnaround in the Irish economy will be “one of the best investments of the decade”.
Irish bonds
His funds hold €8.5 billion worth of Irish Government bonds, making Franklin Templeton the largest holder.
Mr Hasenstab has said his $165 billion (€126 billion) funds are long-term holders of the bonds, although some have questioned what would happen to Irish bond prices if he decided to offload some of his holdings.
Pimco saw €28.2 billion of net sales from January until the end of October 2012, making it the third-largest master group in Europe, with €100.7 billion of assets – an increase from €64.9 billion the previous year.
Franklin, by contrast, suffered a reversal of fortunes during 2012. It pulled in less than €2.3 billion of net sales, with its Templeton Global Bond fund failing to secure a place in Europe’s top-30 best-selling funds. The firm ended the previous year as the best-selling fund house, with €15.7 billion of net sales.
The Templeton Global Total Return fund was up 18 per cent at the end of the year, while the Templeton Global Bond Fund was up 14.6 per cent, according to Lipper.
Franklin was unavailable for comment at the time of going to press. – (Copyright The Financial Times Limited 2013)
