M&G has reported net outflows of £700m from its UK retail business for 2013 after slowing flows into some of its most popular funds.
M&G's highly-rated bond fund manager Richard Woolnough has said he would raise rates this year if it were up to him - but said such a move could present a buying opportunity.
A concentration of flows among an increasingly small pool of funds is prompting buyers to turn away from the biggest players due to fears over performance, liquidity and communication.
Corporate bond managers have begun to shy away from participating in deals dominated by some of their larger peers as market liquidity continues to contract.
M&G retail fixed income head Jim Leaviss has relinquished his lead manager role on two of his main portfolios as part of a reshuffle of the team.