FUND management giant Gartmore is quitting Glasgow - where it managed about (pounds) 1bn only a few years ago - dealing another blow to a financial sector which the city is desperate to develop.

Gartmore, which over the years has managed a raft of investment trusts from Glasgow, including the mighty Scottish National Trust, told staff of its decision to close its Scottish office yesterday. It is centralising its business in London.

A Gartmore spokeswoman said it had had its Glasgow office for about 30 years.

The axeing of the West Regent Street office follows hard on the heels of Abbey National's crushing decision to transfer (pounds) 27bn of the (pounds) 29bn of funds which were managed by its asset management division in Glasgow. Abbey has struck an outsourcing deal with State Street, which will manage transferring funds from London.

Glasgow-based Scottish Friendly is outsourcing management of its (pounds) 350m of funds to an external manager, likely to be based in London.

Gartmore has been quietly running down its Scottish office ever since Diane Wilde, who headed it, left in 2000 for Aberdeen Asset Management. However, Gartmore still has one of its senior investment managers, Richard Prvulovich, in Glasgow.

The spokeswoman said Gartmore would discuss other roles within the company with Prvulovich and his support staff, Frances Clark and the long-serving Elizabeth Stewart.

However, it would seem unlikely the support staff would relocate to London, and Prvulovich's intentions are unclear at this stage.

The three people affected were told of their fate on Monday, ahead of Gartmore's

general staff announcement

yesterday.

The spokeswoman said that Julie Skedd, who was based at its Scottish office, was spend-ing most of her time in

London now.

Brian Gallagher, formerly based in Glasgow, had moved to London a couple of years ago.

''There has been more of a shift to London all the way through,'' added the spokes-woman, who expected the Glasgow office to close within about two months.

Although confirming Prvulovich was still managing funds as part of the UK equity income team at Gartmore, she could not split out any amount he looked after from Glasgow.

The spokeswoman said Prvulovich had also been working on ''projects'', but declined to confirm or deny a comment from one senior industry source that this would include helping Gartmore respond to the Financial Services Authority inquiry into the split-capital investment trust debacle.

Asked about this, the spokeswoman replied: ''I can't comment. Gartmore as a house continues, like everyone else, to assist the FSA. We continue to help them, like everyone else, with their inquiries.''

Just two weeks after it emerged in March 2000 that Wilde was leaving for Aberdeen Asset with colleague Ross Watson, US group Nationwide Mutual announced it was buying Gartmore from Royal Bank of Scotland for (pounds) 1.03bn. Royal had acquired Gartmore with National Westminster.

The senior industry source described the loss of Gartmore's Scottish office as a ''psychological'' blow to Glasgow, but was not surprised, given the lack of investment in it.

''They never tried to grow the business (in Scotland),'' said the source. ''They had the opportunity. They could have had (management of) the unit trusts there.''

Gartmore employs more than 700 staff in the UK, where it manages about (pounds) 28bn.

Its global funds total is (pounds) 50.3bn.

Scottish National Trust, a (pounds) 550m fund when it announced in 1997 that it was rolling over into Second Scottish National, was in its day the largest split-capital investment trust in the UK.