Job cuts planned at troubled Woodford
Woodford Investment Management is planning to cut staff at its Oxford headquarters following the suspension of Neil Woodford's flagship Woodford Equity Income fund.
The cuts are expected to affect a small number of support staff, rather than staff managing investments. Woodford Investment Management employs around 45 people.
Despite the suspension of the flagship fund and the job cuts, the firm continues to charge £65,000 per day in management fees.
We have reluctantly entered into redundancy consultations with a number of staff to advise them that their roles are at risk"
Commenting on the potential job cuts, a Woodford IM spokesperson said: "We have reluctantly entered into redundancy consultations with a number of staff to advise them that their roles are at risk."
The warning came as the Bank of England warned that a wider loss of confidence in illiquid assets could spark mass fire sales and destabilise the global financial system.
On Monday, the fund's supervisor Link confirmed that the equity income fund would remain shut for at least another 28 days as Woodford battles to rebalance the portfolio, following heavy criticism of the disproportionate amount of unlisted, private or "illiquid" holdings.
Woodford has faced criticism from investors, regulators and MPs for continuing to charge fees while the fund is suspended.
The fund's £65,000 a day management fee "covers a wide range of costs associated with running an actively managed fund," the firm said in a bulletin for financial advisers.
"This includes the cost of fund management and also covers the costs of infrastructure and the staff across our entire business who are involved in running the fund."
In the days following the equity income fund suspension, the firm lost the right to manage nearly £4bn.
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