Skandia parent company Old Mutual Wealth Management is developing a low cost fund range targeted at restricted advisers who want to build their own model portfolio service post RDR.
In a statement today announcing its half-year results, Old Mutual says it is in discussions with a number of “high quality asset managers” to develop a new fund range for the post RDR market.
“The new fund range will cover all asset classes, be highly competitive on cost, and will enable any financial adviser to design their own model portfolio service for their customers. It will be particularly attractive to restricted advisers post RDR.”
The Old Mutual group includes the platform business Skandia UK, Skandia International, the merged businesses of Skandia Investment Group and Old Mutual Asset Managers UK and Skandia’s European subsidiaries.
Old Mutual is also planning to launch a range of offshore bonds in the UK, under the Skandia International banner, supported by its new wealth management service Wealth Interactive. The company says adviser charging will be facilitated on the bonds with fund manger rebates paid to clients. Top-ups will be accepted on existing products.
The company has posted a pre-tax operating profit for the first half of the year of £95m, down 17 per cent from £115m for the same period last year. Old Mutual says this is down to a one-off £16m tax smoothing last year.
Net client cash flow fell 60 per cent from £2bn to £800m, which the company says is due to market uncertainty hitting sales.
Net client cash flow on the Skandia platform dropped 40 per cent from £2bn to £1.2bn, which Old Mutal attributes to “a challenging market, advisers distracted by the RDR and a subdued UK tax year end”.
Total gross platform sales fell 21 per cent from £2.8bn to £2.2bn. Funds under management on the platform rose 9 per cent from £18.7bn to £20.4bn.
Old Mutual Wealth Management chief executive Paul Feeney says: “Market conditions are undoubtedly challenging for the financial services market but I believe there are significant opportunities to focus on.
“The RDR is naturally key for us and we see a significant opportunity to build new, customer focused investment solutions that will be in demand post RDR from all types of financial adviser. There will always be a place for open architecture but risk targeted funds, income solutions, model portfolios and DFM services will also be in high demand post RDR and our asset management strength combined with our platform distribution position us ideally to deliver these.”