Asset manager River and Mercantile has said it will continue to make sure it “upholds the highest standards at all times” after a recent fine from the FCA.
Last month, the watchdog fined the firm £109,000 after an investigation into competition breaches surrounding how fund managers worked together on an initial public offering and a share placing.
The FCA found that River and Mercantile, along with Hargreave Hale and Newton Investment Management Limited, had breached competition rules by sharing otherwise confidential bidding intentions, in the form of the price they were willing to pay and sometimes the volume they wished to acquire.
In its latest financial results this morning, River and Mercantile says: “While we are glad to put this matter behind us, the board continues to be focussed on conduct and ensuring that the group upholds the highest standards at all times.”
The firm said the £109,000 penalty was in line with what it had set aside in June last year to cover potential liabilities.
River and Mercantile’s net profit for the six months to the end of December 2018 came in at £6.7m, down from £9.1m for the same period in the previous year.
The firm notes that while revenues were higher and it had rode out market falls, the cost of external research provision had increased in the wake of Mifid II.
Chairman Jonathan Dawson says: “No investor should be surprised when I write that the first six months of our financial year were challenging ones for markets. Despite this, I am glad to report that our business has performed creditably, in particular the diverse nature of our revenue exposures demonstrating our defensive characteristics against equity market weakness.
“Our results in the period reflect our investment where we see opportunities, including our continued development of outcome-oriented solutions to long-term client needs and continuing to make selective hiring of senior staff to strengthen our advisory and distribution capabilities.”