Shares in Natixis fell as much as 12% on June 20 after fund-analysis firm Morningstar said it had suspended its rating of a fund run by H2O Asset Management, which is majority-owned by the French bank.
In a June 19 note, Morningstar put its bronze star status for H2O’s Allegro Fund under review due to concerns about liquidity and the appropriateness of several of the fund’s corporate bond holdings. The Financial Times reported on June 18 that H2O filings showed its funds held more than 1.4 billion euros of illiquid bonds linked to German financier Lars Windhorst, whom the paper said had presided over several company insolvencies and a personal bankruptcy.
Natixis said on June 20 that Morningstar’s move did not call into question the liquidity or performance of the H2O funds. H2O sent a message to clients on June 19 reassuring them about the liquidity of their investments, the Financial Times said.