Savings and retirement giant Phoenix Group said on Monday it will pull around £20 billion from Aberdeen as it moves more of its annuity-backing assets in house.

However, in pensions and savings, Phoenix said Aberdeen will continue to be its “key asset management strategic partner into the future” and potentially will manage “a greater share” of these assets for Phoenix.

Phoenix’s in-housing of the £20 billion annuity-backing assets is unlikely to have a material impact on Aberdeen’s revenue — the assets account for about 1% of Aberdeen’s revenue.

For context, around 90% of Aberdeen’s assets under management (AUM) for Phoenix are on the policyholder side of the business — roughly £150 billion.

Aberdeen Group plc, which owns a 10.4% stake in Phoenix, managed and administered £517.6 billion of clients’ assets at June 30, 2025.

“To optimise customer outcomes and enhance returns we have been evolving our approach to asset management,” said Phoenix in its half year results statement on Monday.

“Historically we have operated an out-sourced operating model for all assets, partnering with the best asset manager in each asset class that we operate across.

“For our Pensions and Savings business, which represents the majority of our AUA, this strategy is unchanged.

“Moving forward we expect to consolidate the number of asset managers we partner with, with Aberdeen continuing to be our key asset management strategic partner into the future, and potentially attracting a greater share of these assets.

“As signalled in March, our strategy for the management of our annuity-backing assets is evolving to one which is predominantly in-house, leveraging the internal capabilities we have built to manage derivatives, public credit and private assets alongside partnerships to source differentiated and unique private assets.

“We are now managing £5 billion of our £39 billion portfolio in-house, and are currently preparing to in-house a further c.£20 billion.

“The shift to this in-housing model covers our annuity-backing assets. We have no intention of becoming a fully-fledged asset manager nor are we looking to manage third party assets.”

An Aberdeen spokesperson said: “We continue to work closely with Phoenix as their key strategic asset management partner.

“As they have announced today, they plan to both in-house annuity-backing assets currently managed by Aberdeen, and change the management of their policyholder assets, with the potential to result in a greater proportion of these assets being managed by us in future.

“We look forward to continuing our close and collaborative relationship.”

A Phoenix Group spokesperson told the London Financial News: “Our strategy for the management of our annuity backing shareholder assets is evolving to one that is predominantly in-house, leveraging the internal capabilities we have built to manage derivatives, public credit and private assets, alongside partnerships to source differentiated and unique private assets.

“The …. £20bn of assets we are in-housing is currently managed by Aberdeen, and we have informed the asset manager of our intention to move these assets in-house and have issued the notice required at this stage.”