Profits and AUM Surge at Rathbones: Marketing-Led Growth Forecast

Nick Parmee

5 March 2007

Rathbone Brothers, a provider of discretionary fund management and wealth management services for private investors and trustees, has announced strong results for the year ended 31 December 2006. Operating income increased by 18 per cent to £134 million ($260 million; 2005: £113 million), lifting pretax profits by 27 per cent to £45 million (2005: £35 million). Successful integration of the acquisition of the London investment management and private banking business of Dexia (see WealthBriefing for December 15, 2006 and today’s article on Dexia’s results) brought 11 investment managers and £600 million in funds under management into Rathbone Investment Management. Mark Powell, chairman of Rathbone, commented:"Record profits and strong funds under management growth of 28 per cent to £12 billion have been achieved in a year which has seen helpful stock market conditions in the UK and overseas, an important acquisition and some valuable recruitments. The year has also seen continuing improvements in the infrastructure of Rathbones and an increase in the underlying rate of net organic growth of funds under management to 7.2 per cent within Rathbone Investment Management and 41.7 per cent in our unit trust business. These statistics reflect the impact of our increased emphasis on marketing generally and especially marketing to financial intermediaries. Subject to market conditions, it seems reasonable to expect a further year of growth in 2007."