Close Brothers has reported a slide in profits despite a rise in client assets.
The parent company of Close Brothers Asset Management said full year operating profit was cut in half, falling to £113.5m from £234.8m last year.
Total assets under management were up though, rising 5% to £17.3bn from £16.6bn.
The company noted that new hires made a significant contribution to the inflows of client money. The firm has been on a hiring spree in recent months, including three appointments made from Investec.
See also: Close Brothers AM makes another hire from Investec W&I
The firm’s brokerage business Winterflood weighed down overall performance, as it was ‘impacted by subdued trading activity’.
Shares in the firm did not respond well to the update, falling 4% to 818p. The share price is down 20% over the past year.
Adrian Sainsbury, chief executive, said: “We continued to attract new client assets in CBAM, with strong net inflows, although Winterflood’s performance remains impacted by subdued trading activity.
See also: Weekly outlook: European sentiment surveys due and AG Barr reports
“This year has been marked by a challenging market backdrop, where mixed economic conditions in the UK have created substantial uncertainty for our consumer and SME customers. Although demand levels have remained robust, the uncertain external environment led to higher forward-looking impairment provisions and difficult conditions for our market-facing businesses, CBAM and Winterflood.”
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