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Brooks Macdonald hits record £15.5bn as outflows narrow

Brooks’ assets under management rose by 13.6% in the final three months of the year as outflows moderated.

Brooks Macdonald hits record £15.5bn as outflows narrow

Brooks Macdonald’s funds under under management (FUM) hit a record high of £15.5bn at the end of 2020 as outflows across the business shrank by 60%. 

In a trading update, the firm said its FUM rose 13.6% in the final three months of the year. 

The company attributed this to strong investment performance, higher inflows and the completion of the acquisition of Lloyds’ offshore wealth business. 

Chief executive Caroline Connellan (pictured) said she was ‘proud’ of the effort put in by the team in difficult circumstances.

‘[Over] the period we built momentum in net flows, delivered strong investment performance, and completed the acquisition of Lloyds’ Channel Islands wealth management and funds business,’ she said.

‘The work we have put in over recent years has made Brooks Macdonald a robust business, demonstrated by our strong commercial performance and strategic progress.’

Total net outflows across the business fell from £261m to £106m. Inflows into the firm’s model portfolio service turned positive over the quarter at £40m.

This was offset by a withdrawal of £43m from its bespoke portfolio service, leaving overall discretionary inflows broadly flat. That outflow was an improvement on the previous quarter, when withdrawals stood at £119m.

The 8.4% rise in FUM in Brooks’ discretionary business to £10.8bn was largely driven by investment performance.

The firm’s balanced model returned 7.9% over the quarter, compared with the MSCI Pimfa Private Investor Balanced index return of 7%. Over six months the model was up 9.5% versus the 6% gain in the benchmark.

Meanwhile Brooks’ fund management business saw net outflows of £84m, which was largely down to outflows from its Defensive Capital fund. That followed an outflow of £100m in the previous quarter.

Its international business swung marginally into the red, with outflows standing at £19m in the final quarter, although Brooks highlighted trends had ‘improved’ during the period.

Performance over the three months, the second quarter of Brooks’ financial year, has left the company confident of hitting its full year targets. It noted the underlying profit and margin, along with revenue, are all ahead of the same period last year.

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