Franklin Resources, Inc. Announces Month-End Assets Under Management

Rhea-AI Summary

Franklin Resources, Inc. (Franklin Templeton) (NYSE: BEN) reported preliminary month-end assets under management (AUM) of $1.46 trillion at December 31, 2023, compared to $1.41 trillion at November 30, 2023. The increase in AUM reflected the impact of positive markets and long-term net inflows. For the quarter ended December 31, 2023, AUM reflected the positive impact of markets, partially offset by long-term net outflows of $5.0 billion, which include $10.8 billion of reinvested distributions. On January 1, 2024, Franklin Templeton completed the acquisition of Putnam Investments, which had total AUM of $148 billion as of December 31, 2023.

Insights

Financial Analyst

The reported increase in assets under management (AUM) by Franklin Templeton represents a positive trend for the firm, indicative of investor confidence and potentially favorable market conditions. An increase in AUM from $1.41 trillion to $1.46 trillion suggests a robust inflow of capital and market appreciation, which can be a signal of strong investment performance or strategic asset acquisition. This growth trajectory, particularly when juxtaposed with long-term net outflows, highlights the firm's resilience in attracting new investments despite some investors redeeming their holdings.

Moreover, the acquisition of Putnam Investments, with its $148 billion in AUM, could significantly bolster Franklin Templeton's market position. However, the integration of such acquisitions can involve risks and costs that may affect profitability in the short term. Long-term benefits, on the other hand, might include economies of scale, a more diversified product portfolio and an expanded client base.

From an investment standpoint, the distribution of AUM across various asset classes shows a balanced diversification strategy, with fixed income and equity holdings being the largest. This balance can mitigate risk and provide stability in volatile markets. Additionally, the slight decrease in cash management AUM year-over-year could suggest a strategic shift from liquidity to longer-term investments, which may align with an optimistic market outlook.

Market Research Analyst

The data presented by Franklin Templeton offers insights into the broader asset management industry's trends. The increase in equity AUM from $447.9 billion to $467.5 billion reflects a bullish sentiment in the equity markets, which could be due to a combination of market rallies and successful stock picks by the asset manager. The fixed income increment from $494.9 billion to $511.7 billion suggests that investors still favor this asset class, likely seeking stability amid uncertain economic conditions. This is consistent with industry norms where fixed income often serves as a hedge against volatility.

Alternatives and multi-asset classes show relatively stable AUM, indicating sustained interest in diversification beyond traditional stocks and bonds. The slight dip in alternatives might be due to market corrections or rebalancing of portfolios. These figures could serve as a proxy for investor sentiment and risk appetite within the industry, signaling a cautious yet opportunistic approach to asset allocation.

Economist

The reported figures by Franklin Templeton can be reflective of macroeconomic conditions. The overall increase in AUM suggests that the economic environment may have been conducive to investment growth, potentially due to factors such as low interest rates, inflation trends, or bullish stock markets. However, the long-term net outflows of $5.0 billion, despite positive market impacts, raise questions about investor behavior and confidence. This could be interpreted as a sign of market participants rebalancing portfolios in anticipation of economic shifts or taking profits after a period of market gains.

The acquisition of Putnam Investments, not yet reflected in the AUM, could act as a strategic move to counterbalance outflows and capitalize on potential synergies. This move may also be a response to competitive pressures in the asset management industry, where scale can be a critical factor for success. The long-term implications of such acquisitions include the potential for improved market positioning and enhanced competitive advantage, provided integration is managed effectively.

SAN MATEO, Calif.--(BUSINESS WIRE)-- Franklin Resources, Inc. (Franklin Templeton) (NYSE: BEN) today reported preliminary month-end assets under management (AUM) of $1.46 trillion at December 31, 2023, compared to $1.41 trillion at November 30, 2023. This month’s increase in AUM reflected the impact of positive markets and long-term net inflows.

For the quarter ended December 31, 2023, AUM reflected the positive impact of markets, partially offset by long-term net outflows of $5.0 billion, which include $10.8 billion of reinvested distributions.

On January 1, 2024, Franklin Templeton completed the acquisition of Putnam Investments. Putnam had total AUM of $148 billion¹ as of December 31, 2023, which is not reflected in the table below.

By Asset Class:
(In USD billions)	Preliminary
	31-Dec-23	30-Nov-23	30-Sep-23	30-Jun-23	31-Dec-22
Fixed Income	$511.7	$494.9	$483.1	$505.1	$494.8
Equity	467.5	447.9	430.4	458.0	419.1
Alternative	256.2	257.5	254.9	257.2	257.4
Multi-Asset	154.6	148.9	145.0	148.3	141.4
Long Term:	1,390.0	1,349.2	1,313.4	1,368.6	1,312.7
Cash Management	65.5	63.2	60.8	62.9	75.0
Total	$1,455.5	$1,412.4	$1,374.2	$1,431.5	$1,387.7
1 Excludes AUM from PanAgora, which was not a party to the transaction.

About Franklin Templeton

Franklin Resources, Inc. [NYSE:BEN] is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 150 countries. Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers specialization on a global scale, bringing extensive capabilities in fixed income, equity, alternatives, and multi-asset solutions. With more than 1,300 investment professionals, and offices in major financial markets around the world, the California-based company has over 75 years of investment experience. The company posts information that may be significant for investors in the Investor Relations and News Center sections of its website, and encourages investors to consult those sections regularly. For more information, please visit investors.franklinresources.com.

Forward-Looking Statements

The financial results in this press release are preliminary. Some of the statements herein may include forward-looking statements that reflect our current views with respect to future events, financial performance and market conditions. Such statements are provided under the “safe harbor” protection of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts and generally can be identified by words or phrases written in the future tense and/or preceded by words such as “anticipate,” “believe,” “could,” “depends,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “potential,” “preliminary,” “seek,” “should,” “will,” “would,” or other - similar words or variations thereof, or the negative thereof, but these terms are not the exclusive means of identifying such statements.

Forward-looking statements involve a number of known and unknown risks, uncertainties and other important factors that may cause actual results and outcomes to differ materially from any future results or outcomes expressed or implied by such forward-looking statements, including market and volatility risks, investment performance and reputational risks, global operational risks, competition and distribution risks, third-party risks, technology and security risks, human capital risks, cash management risks, and legal and regulatory risks. While forward-looking statements are our best prediction at the time that they are made, you should not rely on them and are cautioned against doing so. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other possible future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. They are neither statements of historical fact nor guarantees or assurances of future performance. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them.

These and other risks, uncertainties and other important factors are described in more detail in our recent filings with the U.S. Securities and Exchange Commission, including, without limitation, in Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended September 30, 2023 and our subsequent Quarterly Reports on Form 10-Q. If a circumstance occurs after the date of this press release that causes any of our forward-looking statements to be inaccurate, whether as a result of new information, future developments or otherwise, we undertake no obligation to announce publicly the change to our expectations, or to make any revision to our forward-looking statements, to reflect any change in assumptions, beliefs or expectations, or any change in events, conditions or circumstances upon which any forward-looking statement is based, unless required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240110444055/en/

Franklin Resources, Inc.

Investor Relations: Selene Oh (650) 312-4091, selene.oh@franklintempleton.com

Media Relations: Matt Walsh (650) 312-2245, matthew.walsh@franklintempleton.com

investors.franklinresources.com

Source: Franklin Resources, Inc.

FAQ

What were Franklin Templeton's preliminary month-end assets under management (AUM) at December 31, 2023?

Franklin Templeton reported preliminary AUM of $1.46 trillion at December 31, 2023.

What was the impact on AUM for Franklin Templeton at December 31, 2023?

The increase in AUM reflected the impact of positive markets and long-term net inflows.

What were the long-term net outflows for Franklin Templeton for the quarter ended December 31, 2023?

The long-term net outflows for the quarter ended December 31, 2023 were $5.0 billion, which include $10.8 billion of reinvested distributions.

When did Franklin Templeton complete the acquisition of Putnam Investments?

Franklin Templeton completed the acquisition of Putnam Investments on January 1, 2024.

What was the total AUM of Putnam Investments as of December 31, 2023?

Putnam Investments had total AUM of $148 billion as of December 31, 2023.