Old Mutual Financial Strength 23-08-2016
AUG 23, 2016
Confirmation for our many clients invested with Old Mutual. The platform is going from strength to strength and cements our confidence in the Platform.
With the referendum result still sinking in for many investors, markets continue to show the volatility we could have all predicted. With that in mind it feels like an opportune moment to remind you why Old Mutual Wealth continues to be a strong and stable environment for your clients’ investments.
The financial strength of Old Mutual Wealth is considerable, ensuring the long term sustainability of the platform. Old Mutual Wealth oversees £111.2 billion in customer investments (as at 30 June 2016) and all of its underlying businesses are financially strong and well-regulated, with significant safeguards in place for investors. We are part of Old Mutual plc, a FTSE 100 group that provides life assurance, asset management, banking, and general insurance. Old Mutual is trusted by more than 19.4 million customers around the world and has a total of £342.7 billion assets under management (as at 30 June 2016).
High-performance strategy and a solid business model
Following significant transformation activity over the past three years, Old Mutual Wealth’s vertically integrated strategy of owning distribution, an investment platform, discretionary fund management, and asset management is performing very well, contributing to the strength of new flows into the business. Old Mutual Wealth recorded a pre-tax profit of £307 million in 2015, with net client cash flows of £6.9 billion.
Our business model is built on giving investors access to a wide range of funds from third party fund managers, as well as Old Mutual Wealth’s own in-house asset management business. As a result, the business does not expose its capital to the risks associated with annuities and credit spreads, which is a very different model compared to the risks run by more traditional UK insurance companies.
Well positioned multi-asset solutions
The benefit of multi-asset solutions in uncertain times is that asset allocation is outsourced to specialists with the experience and resources to make effective decisions, so investors don’t have to. This helps take the short-term emotional reaction out of decision making.
Across our multi-asset range of solutions, we emphasise allocation to managers who have consistent and repeatable investment processes, and who share our strong focus on investing for the long term. The Old Mutual Wealth investment division continually speaks to the underlying managers of the funds to gain their expertise and insight. Recent conversations have overwhelmingly shown that many managers have slightly raised their cash levels, but generally avoided making significant changes to portfolios, which are still very well positioned for the future.