Bank of Ireland has yet to receive approval from the Financial Regulator for the fund, but it is expected to have it up and running by the end of the year. Most of the money flowing into it is expected to come from clients of the group’s private banking arm.
It had been expected that Reilly, 62, would retire on leaving BIAM, following a 20-year reign as head fund manager, once the team succeeding him had settled in.
BIAM surprised the market in July by appointing three new managers to fill Reilly’s shoes. The country’s largest asset manager named Chris Johns, an investment strategist at Collins Stewart, as managing director of global research; Paul Boyne, who joined the firm in 2005 from Morgan Stanley Investment Management in London, as head of global equities; and Sean Crowe, a senior executive in its global markets division, as head of fixed income and specialist products.
Reilly had originally been due to retire last year, but agreed to extend his tenure to March 2007 after four senior managers jumped ship to set up a Dublin-based global equities fund for Perpetual Trustees Australia in 2004.
BIAM has seen its assets under management slide by €15 billion to €42 billion over the past two years as the high-profile departures and poor investment returns prompted a raft of international and domestic clients to pull mandates.
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Once a jewel in the bank’s crown, BIAM only represented 1% of the group’s earnings for the year to the end of March, having seen its pre-tax profits slide 32% year on year to €85m.
Mick Sweeney, chief executive of the business since April, has given himself five years to bring assets under management back to €57 billion.