Institutional demand spurs Schroders

6th May 2010 07:47

Fund manager Schroders said the momentum built up in 2009 has continued into 2010 with high levels of new business.Total funds under management (FUM) climbed to £167.9bn at the end of March from £148.4bn at the end of 2009.Net inflows in the quarter totalled £9.7bn, compared to net outflows of £2.1bn in the first quarter of 2009.The Asset Management division saw record net inflows of £9.3bn, with Institutional business providing £6bn of those inflows. FUM in this division rose to a record high of £154.2bn, 68% higher than a year earlier. Asset Management net revenue jumped to £244.8m from £127.5m in the corresponding quarter of 2009, including performance fees of £27.2m, most of which came from gains realised for investors in a European equity fund.Profit before tax for the whole group rose to £93.2m from £12.2m (after £23.9m of exceptional items) last year, of which Asset Management contributed £88.9m this time round, versus £20.9m a year earlier.The Private Banking division's net revenue eased to £24.3m from £26.4m a year earlier, reflecting the low interest rate environment.The division's profit before tax tumbled to £1.3m, after a provision of £3.6m for doubtful debts, from £8.3m a year ago.Net inflows of £0.4bn in the quarter took FUM in Private Banking to £13.7bn.The group believes its business remains "well placed for long term growth" but noted that retail investor demand had slowed recently after the strong market rally, though the group continues to see high levels of new business opportunities from institutional customers.