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You can find the current article at its original source at https://www.theguardian.com/business/2019/jun/05/neil-woodford-apologises-to-investors-for-suspending-fund
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| Neil Woodford apologises to investors for suspending fund | Neil Woodford apologises to investors for suspending fund |
| (about 2 hours later) | |
| Neil Woodford has apologised to investors in his first public comments since he suspended trading in his largest fund on Monday. | Neil Woodford has apologised to investors in his first public comments since he suspended trading in his largest fund on Monday. |
| Once the UK’s most renowned fund manager, Woodford said he was “extremely sorry” for taking the decision to block investors from pulling cash from his flagship Equity Income Fund – but insisted it was in their best interests. | Once the UK’s most renowned fund manager, Woodford said he was “extremely sorry” for taking the decision to block investors from pulling cash from his flagship Equity Income Fund – but insisted it was in their best interests. |
| In a video filmed in his offices in Oxford and posted on YouTube, he said: “As difficult a decision as this is, and clearly frustrating for you, our investors, we felt this was necessary to protect your interests. | In a video filmed in his offices in Oxford and posted on YouTube, he said: “As difficult a decision as this is, and clearly frustrating for you, our investors, we felt this was necessary to protect your interests. |
| “I’m extremely sorry that we’ve had to take this decision. We understand our investors’ frustration. All I can say in response to that is that this decision was motivated by your interests.” | “I’m extremely sorry that we’ve had to take this decision. We understand our investors’ frustration. All I can say in response to that is that this decision was motivated by your interests.” |
| Woodford's fall shows that investment genius rarely last | Nils Pratley | Woodford's fall shows that investment genius rarely last | Nils Pratley |
| Woodford said he would keep investors informed and the fund would be reopened when “appropriate”, but did not comment on when that might be. | Woodford said he would keep investors informed and the fund would be reopened when “appropriate”, but did not comment on when that might be. |
| The fund will be suspended for at least four weeks, during which time investors cannot pull money out or put money in. The decision to freeze the fund was taken after a rush of customer withdrawals following a series of bad market bets. | The fund will be suspended for at least four weeks, during which time investors cannot pull money out or put money in. The decision to freeze the fund was taken after a rush of customer withdrawals following a series of bad market bets. |
| A request by Kent county council’s pension fund to withdraw its £263m investment is thought to have prompted Woodford to take the decision to suspend the fund. | A request by Kent county council’s pension fund to withdraw its £263m investment is thought to have prompted Woodford to take the decision to suspend the fund. |
| Addressing investors, Woodford said in the video that putting a temporary halt to withdrawals would afford the fund the “time and space” needed to reduce exposure to illiquid stocks and private companies. | Addressing investors, Woodford said in the video that putting a temporary halt to withdrawals would afford the fund the “time and space” needed to reduce exposure to illiquid stocks and private companies. |
| He said the capital would be redeployed into “more liquid stocks in the FTSE 350 but primarily in the FTSE 100 that fit in with my core strategy, but which are more liquid and more conventional, if you like”. | He said the capital would be redeployed into “more liquid stocks in the FTSE 350 but primarily in the FTSE 100 that fit in with my core strategy, but which are more liquid and more conventional, if you like”. |
| Comments posted underneath the video were mixed. Ian Jenkins wrote: “Caught out by his own hubris. Overreached himself.” | Comments posted underneath the video were mixed. Ian Jenkins wrote: “Caught out by his own hubris. Overreached himself.” |
| Meanwhile, Philip Fox wrote: “You tried to instigate a terrible takeover of Provident Financial. Of which I own shares to the benefit of you and a few others. Your strategy was terrible but you were not interested in people or companies, just short-term share rise.” | Meanwhile, Philip Fox wrote: “You tried to instigate a terrible takeover of Provident Financial. Of which I own shares to the benefit of you and a few others. Your strategy was terrible but you were not interested in people or companies, just short-term share rise.” |
| However, others were more supportive. “Neil is a good guy, I put my kids through uni thanks to him and his funds. I’m keeping the faith, no knee jerking here, in for the long term, £10k invested in 1990 now £280k. Not bad, cheers Neil,” wrote one supporter under the handle “Ham head”. | However, others were more supportive. “Neil is a good guy, I put my kids through uni thanks to him and his funds. I’m keeping the faith, no knee jerking here, in for the long term, £10k invested in 1990 now £280k. Not bad, cheers Neil,” wrote one supporter under the handle “Ham head”. |
| Keith Marsh wrote: “If anyone can turn this around, it is that man. Investors, relax and let him do what he does and has consistently done best.” | Keith Marsh wrote: “If anyone can turn this around, it is that man. Investors, relax and let him do what he does and has consistently done best.” |
| Assets in the Woodford Equity Income Fund fell by £560m in May to £4.3bn, according to data compiled by Morningstar, a financial research company. | Assets in the Woodford Equity Income Fund fell by £560m in May to £4.3bn, according to data compiled by Morningstar, a financial research company. |
| Andrew Bailey, chief executive of the Financial Conduct Authority said the City regulator would be closely watching developments after the suspension of the fund. | |
| “The key thing is now that this creates … a period of time to put in place a plan and a programme of work that will solve that problem in as orderly a way as possible,” Bailey told Bloomberg Television. | |
| “And that’s what the FCA will be closely watching and closely involved in, where we think it’s necessary.” | |
| Woodford built his reputation over 26 years at Invesco Perpetual, where he personally managed £25bn on behalf of pension funds and other investors. He left Invesco in 2013 to set up on his own. | Woodford built his reputation over 26 years at Invesco Perpetual, where he personally managed £25bn on behalf of pension funds and other investors. He left Invesco in 2013 to set up on his own. |
| Woodford paid himself and his business partner, Craig Newman, nearly £37m in the 2017-18 financial year. | Woodford paid himself and his business partner, Craig Newman, nearly £37m in the 2017-18 financial year. |
| The decision to suspend his flagship fund had a knock-on impact on Tuesday, when investors took fright and shares in his Patient Capital Trust Fund, listed on the FTSE 250, fell by as much as 20% at one point. The share prices of a number of other companies in which he is a key investor or that sell his funds also fell. | The decision to suspend his flagship fund had a knock-on impact on Tuesday, when investors took fright and shares in his Patient Capital Trust Fund, listed on the FTSE 250, fell by as much as 20% at one point. The share prices of a number of other companies in which he is a key investor or that sell his funds also fell. |
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