Bank of Scotland Corporate is to withdraw its £200m funding facility from its joint venture with fund manager AAIM Group.

It is understood that John Moran’s joint venture team at Bank of Scotland Corporate, decided to terminate its £200m debt and equity funding facility with AAIM, at a meeting between the two parties held last week.

The withdrawal procedure is being undertaken by law firm Allen & Overy and is expected to be completed early this month.

The withdrawal of the funding facility will slow down AAIM’s future spending plans for its European Symmetry fund, a £2bn fund which the fund manager had hoped to grow to £4bn.

The withdrawal will also deliver a blow to AAIM’s proposed £2bn Infrastructure Fund, for which the fund manager had planned to draw down money from the Symmetry fund and AAIM India, a fund which AAIM had aimed to grow to £1bn of property under management.

The termination of the agreement is not thought to affect assets already bought by the joint venture.

Additionally, it is not going to affect AAIM’s debt position which is long dated and not thought to be close to breaching its loan to value covenant.

AAIM has historically supplemented its bank finance with funds from celebrities including Manchester United manager Sir Alex Ferguson and television presenter Sir David Frost.

The senior board including chairman Mark Tagliaferri and group investment origination director Stuart Le Gassick have also invested personally, as has former chief executive Robert Whitton. Whitton left in January to form his own property investor ROM Capital and was replaced by James Elton.

His departure was followed by chief operating officer Colin Rowlinson who left last week to join private equity firm GI Partners.

AAIM’s joint venture with Bank of Scotland Coporate was formed in September 2006 at the height of the property boom.

The joint venture was aimed at investing across western and eastern Europe and culminated with large opportunistic purchases including a 49-strong retail portfolio in Germany for £540m and a £290m shopping centre in Hungary – a country record – both last year before the credit crunch . It also bought in diverse sectors such as car showrooms and hotels.

Neither AAIM nor Bank of Scotland Corporate would comment.