The Switzerland-listed group said the impairment charge and loss did not affect its equity, cash position or operations.

GAM Holding, the investments group listed in Zurich, today said that the slide in markets has hit its assets, causing a non-cash impairment charge related to intangible assets and causing a net loss for the first half of 2022.

The group said it expects to report an underlying loss before tax of about SFr15 million compared with a SFr0.8 million profit for the first half of 2021. On an IFRS accounting basis, there will be a net loss of about SFr275 million ($281.8 million) in H1 2022, versus a net loss after tax of SFr2.7 million for the half year 2021.

Total assets under management were SFr83.2 billion, as at 30 June 2022, with investment management at SFr27.1 billion and fund management services at SFr56.1 billion, compared with a total of SFr99.8 billion as at 31 December 2021.

Negative market movements of SFr12.4 billion and foreign exchange of SFr0.7 billion caused almost 80 per cent of the cut in assets under management in the first half. Net outflows for the first half were SFr1.1 billion for investment management and the expected SFr2.5 billion for fund management services.

GAM said that due to the reduction in AuM, it expects to report a non-cash impairment charge of around SFr264 million, related to the intangible brand value which was created by the acquisition of GAM by Julius Baer in 2005. 

However, GAM said the impairment charge and IFRS loss did not not impact the group’s tangible equity, its cash position or any client-related or operational functions.

“During the first half of 2022 we have seen extraordinary economic and geopolitical conditions having a significant impact on markets. As a result of this volatility, clients have been exercising greater caution,” Peter Sanderson, CEO GAM Investments, said.

“Despite this, we are encouraged to see improving resilience in our flows with clients allocating to a number of our high-conviction active strategies designed to help them navigate this challenging environment,” Sanderson added. 

GAM will give a full update on results on 3 August.