Intrinsic increases losses to £13m

Company says net flows into the wider Old Mutual Wealth business contribute to the company’s overall profits

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Old Mutual Wealth-owned network Intrinsic has seen losses increase by 45 per cent to £13m for the first half of the year.

The network posted a £9m loss this time last year.

In its interim results, published today, Old Mutual Wealth attributes the loss to a higher Financial Services Compensation Scheme levy and costs related to growing the business.

It says: “Net flows from Intrinsic’s advisers generate substantial business for Old Mutual Wealth and thereby contribute to the business’ overall profitability.”

Intrinsic and Old Mutual Wealth Private Client Advisers contributed over £100m in net client cash flow to Old Mutual Wealth’s discretionary fund management business Quilter Cheviot. The advice arms combined represent one of the biggest suppliers of new business to Quilter Cheviot.

On the platform, net client cash flow was up 50 per cent from £1.4bn to £2.1bn, driven by pension sales. Platform profits are up 43 per cent from £14m to £20m, while funds under management rose 11 per cent over the last six months from £41.4bn to £45.9bn.

Old Mutual Wealth has seen a growth in “integrated flows” on to its platform and investment management arm Old Mutual Global Investors, but says it “takes its responsibilities for managing actual or perceived conflicts of interest very seriously.”

Chief executive Paul Feeney says: “We have seen continued recognition of the strength, and we believe, the value of our integrated model. Integrated flows rose substantially from £700m to £2.2bn for the six months to 30 June.

“2017 continues to be a year of transition for Old Mutual Wealth as we move towards our separation from Old Mutual plc, and we are excited about the opportunities ahead.”

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. If its “Nett Flows from its Advisers (Intrinsic)generate substantial business for Old Mutual Wealth, which in turn is used to subsidise it, is that not “Contingent Charging” clearly the business model of the Network is Untenable.

  2. O Yes and that’s with a 5% initial charge and a 1% on- going charge, plus its incestuous Funds AMC’S

  3. “Old Mutual Wealth attributes the loss to a higher Financial Services Compensation Scheme levy…”

    And why are the FSCS levies skyrocketing? In large measure because of FCA’s negligence in failing to identify, home in on and put a stop to the mis-selling of junk investments, often with no PII.

    The effects of this are getting so bad that certain sectors of the industry are actually beginning to suffer losses.

    How much longer, we wonder, before a firm goes into liquidation because its financial back has been broken by the scale of its FSCS levy bill?

    Yet all the FCA is prepared to do is vacillate about shuffling the deckchairs around with a view to reapportioning who shall pay what. It’s criminal.

    Remind me please why Andrew Bailey was awarded a thumping great bonus (with OPM).

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