But the firm said its aim to build a “leading private client business in the UK” was well on track, with the division continuing to grow both organically and through acquisitions.
Net inflows of private client assets were £284m during the year, up from £249m in 2011, driven both by its advised business and sales of its investment products through third party intermediaries.
On top of this a further £330m of AUM was added through acquisitions, primarily through Scott-Moncrieff Wealth Management, an advisory business based in Scotland.
“Consistent with our strategy, institutional AUM continued to reduce, reflecting redemptions of institutional client assets and the closure of non-core funds,” Close Brothers AM said.
In March it also completed the disposal of OLIM’s property funds business, which had £355m of AUM. As a result of its move away from institutional, overall AUM for the asset management division at the year-end was £8.3bn, down from £9.6bn a year earlier.
Three-pronged attack
The firm launched a new proposition for advised clients in November 2011, which it said had a steadily building pipeline, while in May of this year it launched an offering for self-directed clients to go directly to its investment portal.
Additionally it has completed a range of investment management solutions and now offers directly invested, multi-manager and passive funds as well as managed accounts and bespoke portfolio management services.
“With our client propositions, technology and business model now in place, our focus going forward is on driving revenue and asset growth through our new client propositions while stabilising and optimising the cost base.
“Initially the focus will be on selling our new integrated advice and investment management offering to existing advised clients, with an increasing focus on new organic growth over time. With the restructuring behind us, asset management is now in a position to move into profitability during the course of the 2013 financial year and, subject to market conditions we currently expect the division to achieve an operating cost margin of at least 15% by the 2015 financial year,” the statement concluded.
