AJ Bell’s inflows from defined benefit transfers have dropped by half in the past year as the DB market continues to decline.
According to the annual results statement of the company, published this morning (October 24) and covering the 12 months to the end of September 2019, AJ Bell’s advised platform received £900m of inflows from pension transfers — 50 per cent less than the £1.8bn of inflows it saw the previous year.
According to an AJ Bell spokesperson, this was an anticipated “natural decline” and not unique to AJ Bell but in line with results across the DB market.
The spokesperson said: “DB inflows peaked back in 2017 when transfer values were high. We benefited from that at the time but now the levels are returning to normal.”
DB transfer activity has been in decline across the industry over the past few months after a surge in activity post pension freedoms.
Total net inflows on the advised platform for the yearly period were £2.7bn — down from £4.2bn the year before — but the platform’s assets under administration were up 13 per cent to £33.8bn on the previous year.
The company’s total assets under administration, including the firm’s direct to consumer platform and non-platform business, were also up 13 per cent to £52.3bn
Andy Bell, chief executive at AJ Bell, said: “Our first full year trading update since the IPO demonstrates the resilience of our business model.
“During periods of unsettled markets and political uncertainty customers have a greater need for established, trustworthy businesses offering high quality service, at low cost to meet their evolving investment needs.
“This has enabled us to continue to add customers and assets to the platform.”
Mr Bell said the long-term growth drivers of the platform market “remained strong” with customers increasingly looking to take control of their long-term savings.
He thought this, coupled with his strong customer retention rate, positioned the firm well to achieve its “organic growth ambitions”.