Old Mutual's funds benefit from equity market boom
LONDON May 8 (Reuters) - Anglo-South African insurer Old Mutual on Thursday reported growth in funds under management for the first quarter that outpaced market forecasts, supported by buoyant financial markets.
The company said funds under management rose 7 percent over the period to 288.4 billion pounds ($448.91 billion), with rising markets adding to the impact of net client cash inflows of 3.9 billion pounds.
Analysts had predicted funds of around 277 billion pounds.
Group Chief Executive Julian Roberts said all the group's main businesses contributed positive flows despite uncertainty surrounding a regulatory shake-up in Britain of financial product sales.
Britain's Retail Distribution Review (RDR), introduced this year, seeks to prevent misselling and improve financial advice by replacing commission-based sales with a fee-based system.
Old Mutual said the UK savings market has been "disrupted" while financial advisers adjusted to the new system and contributed to a 10 percent drop in the net client cash flow via its UK platform.
"We believe (this) is related to RDR, to advisers getting their act together under the new regime... We see that slowly getting sorted out ," Roberts said.
"It is something that has affected the first quarter and will get better as the year progresses."
Old Mutual's sales were unchanged from a year earlier at 269 million pounds, the company said, below consensus forecasts of around 272 million pounds.
The firm is seeking to expand its UK asset management business and achieved a major coup during the quarter with the hiring of high profile fund manager Richard Buxton from rival Schroders to run its UK equities team.