Skandia UK was able to increase underlying profits in the first six months of the year despite seeing mutual fund and UK life assurance sales fall more than 20% during the period.
Adjusted operating profit increased by 14% to £91m (IFRS), with reduced integration activity and significant tax benefits more than offsetting any reduction in asset based fees.
Skandia UK mutual fund sales plunged 21% during the first half, falling from £1.29bn to £1.02bn. It attributed the decline to poor investor confidence in “one of the lowest ISA seasons on record”.
It also recorded a decline in bonds sales, with changes to CGT leading to uncertainty over the continued suitability of bonds.
Skandia UK says £1.1bn in net client inflows partially offset turbulence in world markets, with assets under management down 5.73% to £39.5bn in the period.
Life assurance sales fell 26% the first six months, from £249m to £185m (APE) – largely due to declining pensions sales. It says last year’s sales benefited from the lingering effects of A-day.
Skandia International enjoyed positive life assurance sales, up 2.4% on the corresponding period in 2007.
Old Mutual, Skandia’s parent company, has also announced it will look to roll-out Skandia’s popular ‘Best Ideas’ concept across other businesses under the Old Mutual banner.IFAonline
'Right thing to do'
£69m spent on upgrades
European fintech market 'underserved'