Embattled fund manager Mark Barnett is to leave Invesco after 24 years following a prolonged period of underperformance.
The troubled fund house announced today (May 15) it had been “mutually agreed” that Mr Barnett would leave the firm with immediate effect, with James Goldstone and Ciaran Mallon set to take over as co-managers of his open-ended funds.
Martin Walker will continue to lead the team as head of UK equities after being promoted to co-head of the team at the start of this year, a title Mr Barnett had previously solely held.
Mr Walker will also manage the Perpetual Income and Growth Investment Trust, although the trust’s board served Invesco its notice of termination in April following an extended period of underperformance while Mr Barnett was at the helm.
Mr Barnett said: “I am extremely proud of my career at Invesco and for my long term track record of value creation for my clients.
“I wish Mr Goldstone and Mr Mallon huge success in managing the portfolios in the future.”
Stephanie Butcher, chief investment officer, said: “I have undertaken a comprehensive review of the UK equity range, recognising a period of disappointing performance and listening hard to client feedback.
“When I became CIO in January, I made it clear I would not shy from introducing change where I saw it necessary.”
She added: “All of us at Invesco wish to place on record our appreciation of Mr Barnett’s profound commitment to both clients and colleagues over 24 years.”
Mr Barnett has had a challenging few years at Invesco. His flagship £1.5bn Income and £3.3bn High Income strategies have lost about 40 per cent over the past three years, according to FE Analytics, compared with a UK All Companies sector average loss of 14 per cent.
Both funds rank in the lowest quartile in the sector over three-month, six-month, one-year, three-year and five-year periods.
Mr Barnett’s smaller UK Strategic Income fund has fared little better. The £100m portfolio has lost 36 per cent over five years while its average peer in the UK All Companies sector has lost less than 1 per cent.
With performance suffering, redemptions from the strategies have compounded the pressure on Invesco. Morningstar data estimated investors pulled almost £1bn from the asset manager as a whole in February, bringing the total withdrawn from the fund house over the year to February to £9.9bn.
Last November ratings agency Morningstar downgraded the Invesco funds, citing their exposure to smaller and illiquid companies.
Mr Barnett said at the time he "fundamentally disagreed" with those assessments, adding he had "materially changed" the way the funds invested in unquoted companies, as well as halving their overall exposure to such businesses, since taking over the portfolios from Neil Woodford in 2014.
Mr Barnett's closed-ended mandates have also come under pressure. In November last year the chairman of the Perpetual Income and Growth investment trust warned him about poor performance before firing Invesco in April this year.