Standard Life reports 13% increase in fee income
Standard Life reported fee revenue accelerated in the third quarter as the group powered a 9% underlying increase in assets under administration thanks to the completed acquisition of Ignis Asset Management.
The FTSE 100 insurance and asset management company declared it remained "strongly placed" to deal with the government's new saving and pensions regime, with work pension auto-enrolment adding 110,000 new customers during the quarter as new annuity business fell 67%.
Assets under administration from continuing operations increased to £290bn from £254.1bn at the interim stage, split £159bn third-party funds and £131bn internal, driven by net inflows of £4.3bn and Ignis's £61bn of third-party funds coming on stream from 1 July.
Total platform assets grew by 15% in the nine months to £22.4bn, with the group reported further growth in intermediaries and customers using the Wrap offering.
Fee revenue increased to 13% for the nine months to the end of September, up from 12% in the first half-year, to hit £1.03bn.
Management's increased focus on fee business was behind the recently announced disposal of its Canadian operations for £2.2bn, allowing it to return £1.75bn of capital to shareholders.
Chief executive David Nish said the company was "strongly placed to deal with the far-reaching reforms to the savings and retirement income rules, announced earlier this year by the UK Government, and to support customers through these changes. We have an excellent track record of succeeding in evolving markets."
"Although investment markets are unsettled and may affect the near-term pace of asset and revenue growth, we are very well placed for the future."
Indeed, while it has reported a 55% fall in new annuity business in the nine months of the year so far, it has gained 290,000 customers via pensions auto-enrolment.
Forecasting full year earnings figure of circa 21p a share after this "cautiously upbeat" statement, broker Shore Capital said the Canadian disposal accelerated Standard Life's strategy of asset gathering and asset management and removed "a major exposure of the group's balance sheet to spread and guarantee risk" in its view.