Old Mutual plans RDR funds aimed at restricted advisers
The recently merged asset management business within Old Mutual Wealth Management, comprising of Old Mutual Asset Management (UK) and Skandia Investment Group, is to launch a new fund range aimed at advisers going restricted following the Retail Distribution Review.
Old Mutual, which is set to rebrand the combined unit following the merger of the two businesses, said the new range would specifically be designed to allow advisers to build their own model portfolios for clients.
Announcing the move today (8 August) as part of its half-year results, it said in a statement: “Discussions are currently underway with a limited number of high quality asset managers to develop a new fund range for the post-RDR market.
“The new fund range will cover all asset classes, be highly competitive on cost and will include the best fund managers in the market.
“It will enable any financial adviser to design their own model portfolio service for their customers and will be particularly attractive to restricted financial advisers post RDR.”
Within the results Old Mutual reported that its UK platform, Skandia Investment Solutions, received net inflows of £1.2bn in the first half of 2012, a 40 per cent drop compared to the £2bn recorded for the same period in 2011.
The company said this reflected “a challenging market” and, in particular, highlighted that advisers are likely to currently be “distracted by RDR and a subdued UK tax year-end”.
Total gross sales for the Skandia platform were £2.2bn, down 21 per cent from the £2.8bn seen in H1 2011.
Old Mutual stated that it would be unveiling a new RDR-ready charging structure for the platform later today.
The company also reported overall operating profit of £95m for the first half of 2012, down four per cent compared to the £99m generated in the corresponding period of 2011. The company did generated gross inflows for the period of £5.6bn.
Paul Feeney, chief executive of Old Mutual Wealth Management, said: “Market conditions are undoubtedly challenging for the financial services market but I believe there are significant opportunities to focus on.
“The RDR is naturally key for us and we see a significant opportunity to build new, customer focused investment solutions that will be in demand post-RDR from all types of financial adviser.
“There will always be a place for open architecture but risk-targeted funds, income solutions, model portfolios and DFM services will also be in high demand post-RDR and our asset management strength combined with our platform distribution position us ideally to deliver these.”