As part of the merger the IMA will change its name to The Investment Association from the beginning of 2015. Helena Morrissey CBE, chief executive of Newton Investment Management, will become the new Chairman on 30 June, replacing existing chairman of the IMA Douglas Ferrans.
Mr Ferrans said: "The IMA is in great shape under the leadership of Daniel Godfrey and I couldn't be handing the chair over to a more capable and talented individual than Helena Morrissey."
Otto Thoresen, director general of the ABI, said: "Merging the ABI and IMA investment activities will create a strong new voice for the asset management industry as a whole. Insurers remain a crucial part of that and we look forward to continuing to work closely with The Investment Association".
Helena Morrissey, chairman-elect, said: "The Investment Association will have a vital role in helping the asset management industry do the best possible job it can for the millions of individuals whose savings we invest."
Daniel Godfrey, IMA chief executive, said: "Dougie has been a wonderful chairman, a source of great support and counsel and a good friend. His vision has transformed the IMA for the better and will be missed by both the board and the executive team at the IMA.
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"Helena Morrissey brings great energy, commitment and vision to enhance all that is good about our industry. I am looking forward to working with her to make investment better for everyone, so investors get better long-term returns, so companies can grow and economies prosper.
"Our merger with the ABI's Investment Affairs team means that together we cover the entire range of investment issues on behalf of our clients, whether they are domestic or international individuals, discretionary managers, life companies, pension funds, family offices or sovereign wealth funds.
"Our new name, The Investment Association, describes the broader and deeper reach of the new organisation, its stronger and more unified voice and the collective will of our members to work together in the interests of real people. We are looking forward to welcoming our new colleagues on 30 June."
The IMA is the trade body for asset managers (retail and institutional) who manage over £5 trillion of assets in the UK as at 31 December 2013.