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AJ Bell reports slowdown in DB transfer activity

Bell-Andy-2017-CUT
Andy Bell

AJ Bell has reported a slowdown in defined benefit transfers onto its advised offering as it becomes the latest platform to report a fall in assets under administration after a volatile fourth quarter.

Results this morning show that the platform benefited from £600m in DB transfer inflows in the quarter to December 2017. This fell to £500m in the quarter to March 2018, £400m in the quarter after that, before falling again to £300m in the latest quarter, to December 2018.

AJ Bell, which floated last year, says the dip is in line with what it expected when it released its prospectus for an initial public offering, and predicts a continued decline over the coming year.

AJ Bell chief executive Andy Bell says: “Platforms have been one of the main beneficiaries of defined benefit pension transfers. These have declined steadily since their peak seen in the financial year 2017 and we expect this decline to continue. Despite this and short-term market volatility, the outlook for the platform market remains strong.”

While customer numbers at the platform were up 4 per cent over the quarter to reach 190,000, and underlying inflows were up from £1bn to £1.2bn, negative market movements knocked £2.7bn off the platform’s closing AUA.

Overall, the platform suffered a 4 per cent decline in AUA to £44.2bn, less than the 11 per cent dip in the FTSE All-Share index in the final quarter.

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  1. It was a brief window of opportunity, for my part I had a number of informed investment professionals taking the high transfer values to self invest, but once all of their colleagues had considered transfers it was bound to die down.

    What we are left with is possibly lower quality cases and stricter guidelines, so the party is over. but as with many parties, there is a mess to clear up, and the results of the British Steel fiasco will stay with us for some time, and is already costing us with higher PI premiums.

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