DENVER -- Janus Capital Group Inc. on Tuesday identified ING US Financial Services as the client planning to withdraw $5 billion from the Denver-based mutual funds giant.
Janus, which recently settled improper trading allegations, announced the planned withdrawal in late July without naming the client.
Janus spokeswoman Shelley Peterson said Janus would work with ING to transfer as many of the assets in kind as possible, meaning the financial services giant would take its portion of the underlying securities instead of a cash withdrawal.
The ING withdrawal is equal to nearly 4 percent of Janus' total assets under management.
ING spokeswoman Cindy Schaus said ING continuously reviews its funds offerings and decided to remove Janus funds after a "deliberate and thoughtful analysis."
"This analysis included an overview of performance, cash flows, and investment talents, as well as ongoing feedback from customers and their advisers," Schaus said, adding that the removal was subject to regulatory approvals.
Most assets will be taken out of the Janus Aspen series of funds offered for sale by insurance companies, she said. Janus plans to voluntarily waive any fee increases that would result from the redemption.
"The vast, vast majority of our funds and shareholders will not be affected," Peterson said. "Even those clients in the Janus Aspen series will not be affected by this redemption."
It was the latest blow to Janus, which agreed in April to a $225 million-plus settlement with federal and state regulators to resolve claims that it allowed improper mutual fund trading, a type of rapid, in-and-out trading that can skim profits from long-term fund shareholders.
The practice is legal, but Janus policies discouraged it.
Janus acknowledged 10 market timing arrangements, all of which were ended.
Under the settlement, the company will pay $100 million to investors - $50 million in restitution and $50 million in civil penalties. It will also pay $1.2 million to the Colorado attorney general's office for investor education, future enforcement and attorney's fees, and institute measures to create more accountability.
The company also has undertaken a series of reforms designed to protect stockholders, including finding ways to tie compensation to performance, ensuring investments are not concentrated in single stocks and adding high ethical practices.
Peterson said the company is still working to finalize its settlement with regulators. Federal regulators also are looking into agreements between the company and brokers who sell its mutual funds.
The company's assets under management dipped 4.7 percent to $129 billion in July. Officials attributed most of the loss to a market downturn. In July 2003, the company had $149.6 billion in assets under management.
Janus shares rose 13 cents to close at $13.20 on the New York Stock Exchange.
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Janus Capital: http://www.janus.com