Platform woes cost Aegon £3m in June alone

Platform woes cost Aegon £3m in June alone

Aegon’s platform assets reached an all time high of £120bn in the first half of 2018, but the company spent £3m more than planned on the wave of problems experienced by advisers as it upgraded its technology.

As FTAdviser has extensively reported, advisers across the country have experienced problems with a wide range of functions on the platform, from receiving income to viewing client statements.

One adviser told FTAdviser the cost to his business of the platform upgrade is a "six figure sum", so far.

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But Aegon has said only a small number of clients were affected.

The company has said it will compensate clients and said it took an extra cost of £3m in June as a result of attempting to resolve the issues faced by clients.

Aegon said it expected to incur more costs in the next accounting period but it added that when the integration of the Cofunds business is complete, it will make cost savings of £60m a year.  

Despite its technology problems, Aegon reported net inflows of £2.6bn in the first half of the year, and added a further £1.5bn of assets from existing Aegon clients whose policy had not been held on the platform.

The company said it has a target to transfer a further £7.5bn of these assets to the platform by 2020.

In his statement accompanying the results Aegon chief executive Adrian Grace said the transfer of Cofunds clients to the Aegon platform had been delivered but acknowledged it had created issues for advisers.

He said: "It has not been without its challenges and the upgrade of the Cofunds retail book has resulted in service and operational issues for advisers and their customers, for which I am sorry.

"This is not what we planned to deliver and advisers and brokers have our commitment that we are fully focused on resolving the problems and providing the resource to ensure this is done as soon as possible."

As a whole Aegon's UK business saw its assets under administration reach £171bn, up from £145.5bn last year, while its earnings before tax increased slightly from £61m to £62m.