Schroders  

Schroders inflows boosted by own advice business

Schroders inflows boosted by own advice business

More than half of the net inflows achieved by the Schroders wealth management business in the first half of 2018 came from the advice and platform business it owns.

Data contained in the half year accounts of the investment house, covering the period to 30 June 2018, showed net inflows into the wealth management business were £1.2bn, twice the level of the same period in 2017.

More than half of the £1.2bn, £700m, of inflows came from the Benchmark Capital business acquired by Schroders in 2016.

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Among the assets owned by Benchmark is the Aspect8 financial advice business, and the Fusion platform.  

In contrast, Schroders Asset Management business had zero net inflows in the six months to 30 June 2018.

The accounts of the FTSE 100 company revealed that while the asset management division attracted net inflows of £200m, this was offset by net outflows of £200m from the intermediary part of the business.

In April, Schroders lost the right to manage the £300m Schroders UK Growth trust, which went to Baillie Gifford, and in June it lost the right to manage a UK equity mandate for Openwork, but then won the right to manage a Japanese equity fund for the same company.

This is a new fund, so it will take time to grow in size to make-up for the assets lost on the UK mandates.

All of those changes will be reflected in a future set of accounts.

In the outlook statement accompanying the results, the company's bosses warned there remains considerable "headwinds" for the industry, but they feel there are growth opportunities in the areas in which it has invested.  

The operating margin for the asset management business was unchanged compared with the full year number for 2017, at 45 basis points, while the margin in the wealth management business rose from 61 to 62 basis points.

The company recorded a 10 per cent rise in profits to £397.1m.

Peter Harrison, group chief executive of Schroders, said: "Our diversified business model has again proven its worth.

"Wealth management has seen strong client demand and we have continued to expand our capabilities within private assets and alternatives, offsetting industry headwinds in other areas. We remain confident that we can generate growth through the cycle and that we are well placed to continue to create value for our clients and shareholders over the long term."

david.thorpe@ft.com