Quilter assets continue to be hit by investment manager departures
The departure of a team of asset managers last year has continued to weigh on Quilter, with £600m of client cash leaving the business in the third quarter, taking the total outflows for the year so far to £1.4bn.
In a trading update published this morning, the asset manager reported net client cash outflows of £500m, driven by the loss of £600m from its Quilter Cheviot unit. This compares to inflows of £1.1bn the previous year.
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Quilter’s assets under management and administration (AUMA) edged up 0.5 per cent on the same period last year to £118.7bn. AUMA was up 11 per cent on the end of 2018.
The asset manager’s total outflows for the year so far hit £2.3bn, which it said were in line with expectations. This compares to net inflows of £2.7bn the year before.
As well as the asset manager departers, Quilter said the loss of a quasi-institutional mandate had also contributed to the outflows.
Chief executive Paul Feeney said: “As indicated earlier this year, we expected this year to be challenging for net client cash flows, reflecting an uncertain political and economic backdrop coupled with some Quilter-specific factors, in particular, the loss of a certain cohort of investment managers in Quilter Cheviot last year.”
“Notwithstanding the challenging backdrop, we continue to be encouraged by resilient gross flows and high levels of customer asset retention across our businesses which were broadly stable on 2018, excluding the impact of the Quilter Cheviot outflows.”
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“While near-term headwinds remain, this demonstrates that our clients and their advisers value Quilter’s integrated advice-led model, and this continues to provide support to our revenue and operating margin outlook,” he said.
Feeney added that he expected the company’s new acquisitions of Lighthouse and Charles Derby Group to “contribute more meaningfully to flows from next year.”
Main image credit: Quilter