Australian wealth manager ClearView has recorded a steep 23 per cent increase in profits for the year ended June thanks largely to the strong performance of its life insurance and financial advice arms.

Australian wealth manager Clearview has recorded a steep 23 per cent increase in profits for the year ended June, thanks largely to the strong performance of its life insurance and financial advice arms.

As a result underlying net profit after tax came in at $19.7 million - up from $16 million a year earlier - while net profit after tax significantly increased to $13.9 million compared to $1.9 million.

Meanwhile, funds under management grew by 8 per cent over the year to $1.66 billion.

Yet despite the overall strong performance, the group’s wealth management arm was  less successful. Its underlying net profit after tax was $5.9 million, down 11 per cent from $6.6 million in 2013.

ClearView warned that fee and margin compression and the cost of compliance was hurting the wealth management industry.

“The lack of stability of superannuation policy settings is adding costs to funds, which are ultimately borne by members. Furthermore, constant regulatory and policy setting change can also reduce confidence in the superannuation system itself,” said Simon Swanson, managing director at ClearView.

ClearView says it is responding to these problems by investing in and launching its latest wealth management product called ClearView WealthFoundations in the first half of next year.

“Implementing a new compliant and functional wealth platform to host both a competitive mid-market product and the Master Trust product has therefore become a strategic priority with some investment in the overall ClearView business now shifting to wealth management,” the company said in its results report.