BNP Paribas will transfer control over its hedge fund of funds operation to London-based Fauchier Partners.

The business that started as a joint venture in partnership with Patrick Fauchier and Christopher Fawcett will now have a simplified structure and unified control. The unit has $3.5 billion in assets under management and is servicing high net worth individuals and charities advising them on investing in hedge funds.

 

Baudouin Prot, chief executive of BNP Paribas declared that the European investment business remains challenging for banks. In Europe BNP has been trying to catch up with its competitor in the asset management business Société Générale.

 

Hedge funds of funds have grown popular with investors as they hope to achieve counter-cyclical performance of their investments in the times of increased stock volatility. Managers of hedge funds of funds typically charge an annual fee and share in the appreciation of the assets under their management.