Schroders, the UK fund manager, today reported a profit rise of 7% in the first half of the year despite outflows of almost £5bn (€7.4bn) in funds managed on behalf of institutions.

The company said the institutional outflows, which amounted to £4.6bn, were a result of "performance issues" in its Japanese equities offering in previous years, and continued redemptions from UK balanced mandates as investors switch to more specialist investment briefs.