THE Scottish American Investment Company, the (pounds) 317m trust managed by First State Investments, fell short of its benchmark again during a turbulent first half in global markets.

The trust, one of the oldest, reported a net asset value total return of 6.02% for the six months to June 30, while its benchmark index (65% FTSE All-Share and 35% FTSE World ex-UK) rose 7.28%.

Saints said the investment performance was in line with a peer group of similar trusts.

Brian Ivory, Saints chairman, claimed: ''Under the direction of the board, First State has taken significant steps to address the company's poor historic performance record and I am encouraged by the progress that has been made following these changes.''

First State, which bought Edinburgh-based fund manager Stewart Ivory in 2000, has been put ''on probation'' by notorious vulture fund Advance UK, which owns 3% of Saints.

Advance believes Saints should merge with another trust. The vulture fund, managed by Progressive Asset Management, has a reputation for stakebuilding in investment trusts and agitating for major change such as merging or changing investment manager.

Saints paid a second quarterly dividend of 1.41p per share.