The Hibernian group has decided to retain its Irish investment operations in Dublin but will transfer international equity management and back office functions to its British sister company, Morley Asset Management.
The decision follows a review of Hibernian Investment Managers, which employs 48 people in Dublin. In July the board had accepted that a strong business case existed for the closure of its €7 billion Irish business.
HIM senior management, led by Mr Martin Nolan, who will become managing director, put a counter-proposal to the group which was adopted by its parent, British conglomerate Aviva. Mr Nolan said that 80 per cent of the €7 billion in assets managed by HIM would stay in Dublin. The remainder will transfer to Morley Investment Managers.
HIM is expected to shed 25 staff in the re-organisation. Mr Nolan said some would have the option of moving to the wider Hibernian group while others would be offered voluntary redundancy and early retirement.
Some 75 per cent of staff who remain with HIM will be directly involved in fund management or client-facing activities, according to Mr Nolan. Asset allocation, fund management of bond portfolios, Irish equities, Irish property and specialist equity portfolios as well as marketing functions will stay in Ireland.
He said the decision was good news for its clients. "It is a vote of confidence in HIM and ensures that the Irishness of Hibernian is maintained."
Hibernian chairman, Mr Peter Malone, said the announcement confirmed the group's long-term commitment to the Irish investment market.
HIM will continue to be part of the Aviva group. Mr Roy Asher, HIM's head of bonds, will take over as chief investment officer.
HIM staff are contracted to the Hibernian life and general group, even though the fund management arm is a separate company. Many are members of the Amicus Manufacturing Science Finance trade union. Talks have begun with the trade union in relation to redeployment and voluntary redundancies.
Morley manages total assets worth £115 billion sterling, which includes funds operated out of Boston, Warsaw, Melbourne and Singapore.
Figures from Aviva yesterday show that life and pension sales at Hibernian fell sharply in the first nine months of the year. Turnover was down just over 40 per cent at £167 million sterling in what the company said were "continuing difficult market conditions".
New business fell to £55 million in sterling terms from £85 million on an annual premium equivalent basis. Much of this was accounted for by one-off sales of SSIAs in 2002, which accounted for £23 million in the equivalent period.
Reflecting the trend throughout the year, new regulator premium pension sales were flat at £32 million while new single premium pensions business were ahead of last year at £82 million, up £4 million.
Sales of Personal Retirement Savings Accounts have been slow to take off, the company said. In life business, new single premium sales slumped to £42 million from £138 million in the first nine months of 2002. Regular life premium sales were also lower at £11 million, down from £31 million.
