Alliance Capital's first quarter earnings of $0.58 per diluted share came under analysts' expectations of $0.63. Assets under management increased, but the firm cited high expenses from legal fees in the Enron-related case brought on by the Florida State Board of Administration.

Total assets under management increased 10 percent, to $533.9 billion at the end of March from $486.4 billion at the end of December.

Alliance's retail channel was the only channel with net outflows. Retail assets under management dropped one percent, from $158.9 billion to $157.6 billion. Market appreciation in the channel of $6.0 billion was mitigated by $3.3 billion in net outflows and cash management.

Alliance officials attributed the net outflow in the retail channel "mostly to the closing of a number of mutual funds, part of a previously announced plan to improve the clarity and utility of our product array for this client group."

Institutional investment management assets, making up 58 percent of total AUM at the end of March, increased 15 percent from last quarter. Private client assets were also up 15 percent from last quarter, totaling $65.1 billion or 12 percent of total AUM at the end of March.

Growth in the institutional channel was attributed to a backlog of mandates that had been won but not yet funded.

Lewis Sanders, chairman and chief executive officer of Alliance, also cited international investors as a driver for the company's growth. At the end of March, non-U.S. client assets totaled 26 percent of total AUM, or $141.5 billion. 

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