Royal London assets hit £100bn for first time

Royal London — which includes the former Scottish Life and Scottish Provident businesses — said funds managed by the group have passed £100 billion for the first time.

Group funds under management were £101 billion at September 30, 2016, up from £84.5 billion at December 31, 2015.

The group said Royal London Asset Management (RLAM) continued to perform well, attracting external new year-to-date inflows of £4.8 billion compared to £2.5 billion at September 30, 2015.

“This was largely due to a significant increase in institutional new business investing in our fixed income range,” said Royal London.

However, the firm’s Ascentric wrap platform saw gross sales of £1.6 billion compared to £1.9 billion at September 30, 2015.

Royal London, the UK’s largest mutual life, pensions and investment company, employs more than 1,200 in Scotland.

New life and pensions business — on a present value of new business premiums basis (PVNBP) — was £6.29 billion, up about 30% from £4.86 billion at September 30, 2015.

Total intermediary new life and pensions business was up 28% to £6.07 billion, group pensions were up 50% to £2.87 billion, and individual pensions and drawdown was up 11% to £2.68 billion.

Royal London group chief executive Phil Loney said: “We continue to build a strong presence in the workplace pensions market and have always maintained the importance of diversification in investment approach including holding property as an asset class.

“Rules designed to cap the charges on pensions threatened to exclude property from default pension funds.

“Just outside the reporting period we achieved an important clarification from the Department of Work and Pensions (DWP), which confirmed that property can remain a key asset class in our default pension portfolios.”

Loney added: “The combination of new businesses inflows in our asset management and pensions business and rising asset values, means that Royal London for the first time has more than £100 billion in funds under management.

“Institutional sales have been particularly strong and wholesale business has held up well through the volatility stemming from the UK referendum on EU membership.

“Reaching this significant funds under management milestone reflects growth by acquisition and organically, as well as the expanded fund range developed by our asset management arm over the past five years.

“At the end of December 2011 funds under management were £46.2 billion.

“The impressive growth demonstrates the commitment to growing institutional and wholesale assets through innovation in the credit and multi asset capabilities as well as the success of our award–winning pensions range for individual and workplace pensions.”