SLI inflows hit with 40% fall

Standard Life Investments saw its third party net inflows fall by 40% in the first half following the transfer of its money market funds, although group-wide AUM edged up.

SLI saw third party net inflows of £2.9bn in the six months to 30 June, down from £4.7bn in the first half of 2010.

The group said strong net inflows, as well as the impact of positive market movements, were offset by outflows on the transfer of money market funds to Deutsche Asset Management, which reduced assets by £4bn.

The £2.9bn net sales were driven by demand for higher margin wholesale, Global Absolute Return Strategies (GARS) and real estate products, partly offset by outflows from UK segregated funds, SLI said.

The SICAV range, predominantly sold in Europe, saw sales up by 40% to £418m in the first half.

Assets under management in its third party business remained at £71.6bn, representing 46% of total AUM.

The group's MyFolio range of risk-graded funds have grown to £600m since launch in November 2010. The funds are now managed by Bambos Hambi, who joined the firm in March.

Standard Life as a whole reported UK pre-tax operating profits up 14% in the first half, driven by lower commission costs as IFAs switch to fee-charging.

UK pre-tax operating profits rose to £87m in the six months to June, up from £76m for the same period in 2010.

"Our focus on those IFAs who are best placed to prosper in the new market environment we are entering, and developing solutions for both them and their clients, has allowed us to grow our intermediary market share without incurring the cost of commission on new business," the insurer said.

Group-wide, Standard Life increased pre-tax profits by 44% to £262m in H1, up from £182m a year earlier. Assets under administration at the group reached the £200bn barrier.

UK new business sales were up 19% to £8bn, and fee business AUA grew by 3% to £102bn. Standard Life said the rise in AUA reflected continued good flows as well as positive market movements.

Standard Life said assets on its platforms is approaching the £11bn mark, with the number of adviser firms using the Standard Life wrap up from 727 to 926 with an average £8.2m per firm, up from £6.1m in 2010.

The insurer said it had delivered £30m of efficiency savings over the period and would seek to take more cost-cutting measures.

It also announced an interim dividend of 4.6p per share, up from 4.35p last year.