According to The Sunday Times, Orange is the latest UK client to fire Deutsche Bank as its fund manager. The mobile phone company is said to be off to JP Morgan Fleming Asset Management. The German bank's UK fund arm has suffered from a number of high profile client defections this year and the pressure is thought to be mounting on Paul Manduca, the CEO of Deutsche Asset Management's European operations.
Although boss of Europe, Manduca may end up the fall-guy for the disappointing performance of the UK business. According to research firm Russell/Mellon, Deutsche's benchmark British pension fund ranked 55th, in terms of performance in the 12 months to 30th June, out of the 71 funds tracked. But Deutsche's asset management problems are not just isolated to the UK. As The Sunday Times points out, worldwide in 2003, 'it's assets under management fell 11% to $700bn....compared with a 22% industry average increase in assets'.
Now the jury is still out as to whether Manduca is likely to pay the ultimate price. He joined the firm in late 2002 and some say that he has had enough time to make his mark. And Deutsche has just appointed Kevin Parker to head up asset management globally - and he is known not to be one to take prisoners. But others see Manduca as part of the solution, rather than the problem. He just needs to be given more time and support to get Europe, and particularly the UK, right. Interesting times at the Deutsche funds arm.