This followed a drop of 11.6 per cent at the end of last year.
In a trading update issued on the stock exchange this morning (May 4), the firm reported that its investment management business was also up slightly with funds under management of £45.8bn.
This was an increase from £45.1bn at the end of 2022, following a 10.2 per cent fall.
Rathbones chief executive, Paul Stockton said the figures reflect “positive market and investment performance”.
Net inflows in the group’s discretionary and managed business were £303mn, representing a 2.6 per cent annual growth rate.
Net operating income increased by 6.4 per cent compared with the previous quarter to £117.8mn.
“Rathbones remains on track to meet the operating margin targets provided in the 2022 preliminary results, supported by the successful delivery of Saunderson House synergies and the launch of an enhanced digital capability,” Stockton said.
Elsewhere, the group reported that its Rathbone funds business had assets under management of £11.4bn in Q1, up from £11bn in the final quarter of 2022.
Meanwhile, assets under management for Saunderson House were down from £4.1bn to £3.7bn.
Underlying net operating income totalled £117.8mn for the period, representing a 2.2 per cent decrease on the same period last year.
The group also reported a drop in its investment management fees of 3.7 per cent to £69.5mn as a result of lower funds under management.
Commissions totalled £12.5mn in Q1, down from £14.9mn in Q1 2022.
However, net interest income grew to £8.6mn, up from £21mn in the same period last year.
This was as a result of the increase in the Bank of England base rates over the year, from 0.75 per cent at the end of March 2022 to 4.25 per cent currently.
Fees from advisory services and other income decreased by 23.8 per cent to £11.2 million, a drop from £14.7mn in Q1 2022.
Rathbones said this was a result of advisers focusing on the migration of Saunderson House clients.
At the beginning of April it was announced that Rathbones and Investec’s private clients arm are to merge, creating a £100bn UK-based discretionary wealth manager.
Commenting on this, Stockton said today: “The Prospectus and Circular in relation to the combination will be published later this quarter. This transaction represents a significant opportunity in our sector to become the UK's leading discretionary wealth manager.”
The deal will see the entire share capital of Investec W&I acquired by Rathbones, with the wider Investec Group receiving a 41 per cent stake in Rathbones with voting rights of 30 per cent.