M&G Investments had a bumper third quarter with a massive net inflow of £6.4 billion in the third quarter.
The record figure, which represents a massive increase of 329% on the £300 million inflow in the corresponding period of the previous year, is in reflection of investors returning to the market after a period of 'extreme risk aversion'.
Total inflows year-to-date stand at £11.3 billion, more than four times higher than the £2.6 billion of asset flows in the previous year.
Within this, retail funds sales have been robust, with £1.9 billion of inflows in the third quarter lifting the total for the year-to-date to £6.1 billion. However, as expected, retail sales in the UK slowed to £0.5 billion over the period, mainly due to the decision to slow inflows into two of its top leading corporate bond funds.
To counter this, Europe attracted strong inflows of £1.4 billion over the quarter. The Continent has accounted for more than half of net retail inflows since the start of the year at a total of £3.5 billion, reflecting the success of the growing power M&G brand in these newer markets.
Funds under management with European clients now exceed £12.2 billion, a 56% increase on funds under management of £7.8 billion this time last year.
Overall, total funds under management at M&G were 12% higher on the third quarter at £216.9 billion at the end of the third quarter.
Tidjane Thiam (pictured), chief executive at M&G parent Prudential, said in a statement to the stockmarket: ‘This is our best ever performance at the nine month stage, surpassing the historically high level of net inflows achieved in 2009.
‘M&G has benefited from its strong investment performance and broad range of attractive funds across asset classes as retail investors, particularly those in continental Europe, are starting to invest again after a period of extreme risk aversion observed in 2011.’
Over the third quarter of 2012 overall asset management inflows at Prudential, due largely to M&G, rose hugely, hitting £12.3 billion up from £3.4 billion in the third quarter of 2011.
Across the wider group, Pru’s UK business rose 17% compared to the third quarter of 2011 from £194 million to £227 million.
Pru said it expected investment bond sales, in particular, to be impacted by the impending retail distribution review with a slowdown showing in the last stages of 2012.
It said individual annuity sales were up 25% to £166 million. Sales to customers who did not already have a pension with the Pru were up 41% to £62 million reflecting, it said, the popularity of its with-profits Income Choice Annuity product.
However corporate pensions sales fell 22% to £148 million despite the introduction in October of auto-enrolment. Pru said it was not focused on establishing new schemes but was focusing on increasing membership within existing schemes.
Onshore bonds sales were up 27% at £161 million.
‘We are in the right markets, with the right business models and continue to make good progress across our businesses and chosen markets,’ Thiam said.