Old Mutual has confirmed it plans to separate Old Mutual Wealth (OMW) as well as its four businesses that also include Old Mutual Emerging Markets, Nedbank and US business OM Asset Management.
The separation expected to be completed by end of 2018
Paul Feeney, (pictured) chief executive of OMW, said: ‘Old Mutual plc’s announcement today is a great endorsement of our successful business strategy. We have a very exciting future ahead of us.
He said: ‘Beating the objectives we set three years ago, our company has delivered outstanding results for 2015 despite being faced with some of the most difficult global stock markets I have ever seen…Our vertically integrated business strategy is now delivering results for our customers and shareholders. It is this strategy which truly differentiates us from our industry peers.’
Bruce Hemphill, group chief executive, said: ‘The strategy we have announced today sets out a bold new course to unlock value currently trapped within the Group structure. We have four strong businesses that can reach their full potential by freeing them from the costs and constraints of the group.’
For the 12 months to 31 December 2015 Old Mutual made a pre-tax operating profit of £1.7 billion up 11%.
Old Mutual Global Investors (OMGI) saw net client cashflow increased by 40% to £3.5 billion (up from £2.5 billion).
OMGI profit increased to £71 million (from £33 million) and funds under management increased by 18% to £24.7 billion (up from £21 billion).
Its UK platform saw inflows by 35% to £2.7 billion (up from £2.0 billion). Profit increased by 74% from £19 million to £33 million.
Old Mutual said the platform’s growth had been primarily driven by strong pension sales as OMW was benefiting from the pension freedom reforms which came into force in April 2015.
Sales of the UK Platform products through the Intrinsic restricted advice panel now account for 25% of all UK Platform net client cashflows over year.
Total UK Platform flows into OMGI increased hit £1.1 billion.
Profits for UK operations that include Intrinsic and the UK institutional business were £17 million, up from £9 million. Though Old Mutual said Intrinsic’s profits had been hit by the industry wide Financial Services Compensation Scheme levies.
Source: New Model Adviser