Asset Management's fourth quarter revenue increased 12% and achieved a record year end level of AUM.
Our global announcement volume increased 3% even as the markets volume declined 10%.
In particular, our volume of French and UK announcements increased 34% and 37% respectively from the prior year.
In 2020, we recruited 12 new Managing Directors globally, plus two more in January of this year.
In addition, we are promoting 15 new Managing Directors in Financial Advisory this month.
10 of them began their careers here as analysts or associates.
On assets under -- our assets under management increased by $31 billion or 14% from the start to the finish of the fourth quarter.
Our fourth quarter operating revenue of $849 million was a record quarter for the firm, 20% higher than last year's period.
Fourth quarter adjusted earnings per share of $1.66 increased 82%, reflecting the significant operating leverage in our model.
Annual revenue of $2.5 billion was about even with 2019, representing a strong recovery from the volatile environment of 2020.
Our Financial Advisory business had a breakout fourth quarter, with record quarterly revenue of $509 million, which is 23% higher than our previous peak level in 2018.
In Asset Management, this story was similar as we generated $336 million in revenue for the fourth quarter, up 12% from the prior year.
Fourth quarter management and other fees increased 10% sequentially from the third quarter, reflecting higher average AUM.
Average AUM for the fourth quarter was $246 billion, up 3% from last year's period and up 9% from the third quarter of 2020.
The sequential increase was driven by market appreciation of $25.4 billion and foreign exchange appreciation of $5.8 billion, partially offset by net outflows of $0.3 billion.
For the full year, we experienced net outflows of $11.4 billion, primarily in our value strategies within emerging markets and local equities.
We finished 2020 with AUM of $259 billion.
And as of January 28, AUM was approximately $258 billion.
The decrease was driven by foreign exchange depreciation of $1.3 billion and net outflows of $1 billion, partially offset by market appreciation of $1.3 billion.
Turning to expenses, our compensation ratio for 2020 on an adjusted basis was 59.5%, up from 57.5% in 2019.
On an awarded basis, our annual compensation ratio was 59.8% compared to 57.7% for 2019.
Non-compensation expense of $117 million in the fourth quarter was 10% lower than the same period last year, primarily reflecting a continuation of global travel restrictions and lower business development costs.
Our adjusted non-compensation ratio for the fourth quarter was 13.7% and the ratio for the full year was 17.1%.
Our effective tax rate for 2020 was 20.2% compared to 24.1% a year ago.
For 2021, we expect an annual effective tax rate in the low to mid 20% range.
In the fourth quarter, we returned $51 million of capital to shareholders.
Yesterday, we declared a quarterly dividend on our common stock of $0.47 per share.
Our total outstanding repurchase authorization is now $267 million.
As of December 31, our cash and cash equivalents were approximately $1.4 billion.

Summary:
On assets under -- our assets under management increased by $31 billion or 14% from the start to the finish of the fourth quarter.
Our fourth quarter operating revenue of $849 million was a record quarter for the firm, 20% higher than last year's period.
Fourth quarter adjusted earnings per share of $1.66 increased 82%, reflecting the significant operating leverage in our model.
Our Financial Advisory business had a breakout fourth quarter, with record quarterly revenue of $509 million, which is 23% higher than our previous peak level in 2018.