Rathbones has closed out 2020 with £55bn in assets thanks to a bumper performance from its funds business as it unveils the former CEO of Phoenix will take over as its chairman.
The FTSE 250 investment group reversed the tide of outflows in Q4, netting £500m of inflows compared with £200m of redemptions in the previous quarter.
This took its total funds under management and administration up to £54.7bn for 2020, up 8.6% from £50.4bn in 2019. By comparison the FTSE 100 fell 14.3% over the year, while the MSCI Pimfa Private Investor Balanced Index was largely unchanged.
Rathbone’s strong finish to the year was thanks entirely to its funds business which raked in £550m over the last three months of the year as markets took off following the flurry of positive vaccine news.
Despite the fallout from the Covid pandemic Rathbone’s unit trust business enjoyed a bumper year, recording net inflows of £1.5bn compared with £943m in 2019. On an annualised basis that represents 20.1% of opening funds under management.
Over the year total assets in its funds business climbed to £9.8bn, up 32% from £7.4bn in 2019.
Investment management arm haemorrhages over £3bn
Meanwhile its investment management business was hit by another £50m of outflows in the final quarter despite benefiting from £849m of organic business and £66m of acquired business.
Rathbones said this was down to a £143m hit in the final quarter from the withdrawal of a low margin mandate as well as the withdrawal of non-fee-paying and execution only business.
Outflows for the year totalled £3.3bn though this was 14.3% lower than in 2019 (£3.9bn). Total assets in the investment division were up 4.5% at £44.0bn compared with 2019.
Rathbones appoints ex-Phoenix CEO as chair
In a separate trading update Rathbones announced it had roped in former Phoenix CEO Clive Bannister to become its new chairman, replacing Mark Nicholls who is retiring this year after a decade in the role.
Bannister joins the board as a non-executive director with immediate effect and it is expected he will succeed Nicholls after the firm’s AGM on 6 May concludes, subject to regulatory approval.
Rathbones said he will “bring a wealth of strategic, commercial and financial experience to the board”.
Bannister was the CEO of Phoenix Group for nine years before retiring last March. Prior to that he spent many years at HSBC Group where he served as CEO of private banking and group managing director of the insurance and asset management division.
His previous NED appointments include the Association of British Insurers, Punter Southall, Unigestion and Ping An. He is currently chairman of the Museum of London.
Rathbones chief executive Paul Stockton (pictured) said: “I would like to welcome Clive to the board, and I am very much looking forward to working with him as we take the business forward.
“On behalf of all at Rathbones, I would like to give heartfelt thanks to Mark for his outstanding contribution throughout his tenure and wish him well for the future”.
