Brandeaux, which has a range of three funds and assets under management of at least £1bn, announced last week it had taken the decision to suspend its entire fund range due to a high number of redemption request and problems with market liquidity, as revealed by International Adviser.
However, Royal London 360°, whose clients had direct exposure to the funds rather than through a mirror fund structure, has revealed it had concerns with Brandeaux after the company suspended its funds in late 2008.
Due to its concerns, RL360° said it decided not to allow any new flows into the Brandeaux range from then onwards.
A spokesperson confirmed its policyholders have less than £30m invested in the suspended funds, which include the Brandeaux Student Accommodation Fund, Ground Rent Income Fund and the Brandeaux Dual Asset Fund, and that 80% of that is already pending redemption.
Meanwhile, Old Mutual Wealth, formally Skandia, ran a mirror fund called the Old Mutual Guernsey (OMG) Brandeaux Property Fund which invests in the Brandeaux Dual Asset (Sterling) Fund. The company said the product was marketed only in South Africa and confirmed a fund size of £18.9m.
A company spokesperson said “owing to administration difficulties which the changes in the dealing cycle” introduced after the lifting of the suspension on the underlying fund in 2010, it would not accept new investment into the fund. The administration difficulties cited were the introduction of a six clear calendar month notice period on redemption results.
The spokesperson added it has no regular investment business going into the fund as it was primarily available to single premium business.
Old Mutual said it stopped taking the policy administration fees on the mirror fund, which are in addition to the fees on the underlying fund, on 1 July 2013.
Friends Provident International also operates mirror funds linked to the Brandeaux range. These are the FPI Brandeaux Ground Rent Income Fund and FPI Brandeaux Student Accommodation Fund. FPI was unable to confirm the amount invested in the funds following a request from International Adviser.
In a notice sent to policyholders on 2 July, FPI confirmed the mirror fund’s suspension and that no trading activity, either in or out, would be allowed to take place. It added that regular investment amounts that were being made into the fund would be redirected into the M65 Investec GS Sterling Money Fund (also a mirror fund).
This story was updated at 9:45am on 12 July as the original headline did not accuratley reflect the views expressed within.
