Higher funds under management and favourable currency and market movements within its asset management and wealth businesses have helped boost Investec’s profits.
In the financial results for the year to March 31 2017, Investec reported overall ongoing operating profit for the business of £664m in the year, up 13.7 per cent from the £584m in 2016. In addition it noted third party assets under management increased 23.9 per cent to £150.7bn.
Within the group, Investec Asset Management reported a 22.3 per cent increase in profit to £164.8m as it saw total funds under management rise to £95.3bn up from £75.7bn in 2016.
The Wealth & Investment arm also recorded a boost to funds under management to £54.8bn, up from 45.5bn the previous year, as it noted operating profit reached 93.2m, an increase of 8.8 per cent. It attributed the increase to “higher average funds under management supported by higher equity market levels and net inflows of £1.2bn.
In the Specialist banking sector operating profit increased by 11 per cent to £454.4m, and although the South African business reported a decrease in operating profit in rand terms of 3.3 per cent, the UK and other businesses saw increased profit supported by “robust levels of corporate client activity across the lending, advisory and client flow trading businesses”.
Stephen Koseff, chief executive of Investec commented: “For the first time our revenues have broken the £2bn mark showing the strength and resilience of our businesses in the face of macro uncertainty in our two key markets. Our client focus, multiple income streams and long term investment strategy give us confidence for the future."
Meanwhile Bernard Kantor, managing director of Investec, added: “We have seen solid growth in all the core earnings drivers for our three business areas thanks to investment in our people, our infrastructure and our franchises. Strong, sustainable levels of corporate and private client activity are reaping rewards for the Specialist Bank while both Asset Management and Wealth & Investment are benefiting from higher funds under management."