Interim Management Statement

RNS Number : 3104R
Standard Life plc
02 November 2011
 



Standard Life plc

2011 Q3 Interim Management Statement

2 November 2011

Robust performance in difficult market conditions

·   Group assets under administration (AUA) of £191.1bn (31 December 2010: £196.8bn, 30 June 2011: £200.0bn) have remained resilient reflecting the Group's diversified AUA mix

·   Standard Life Investments third party assets under management (AUM) of £69.1bn
(31 December 2010: £67.7bn1, 30 June 2011: £71.6bn)

·   Long-term savings new business sales up 10% to £15.5bn (2010: £14.0bn) after broadly maintained sales in the quarter

·   Long-term savings net inflows excluding conventional with profits up 5% to £4.4bn2 (2010: £4.2bn2)

·   Standard Life Investments third party net inflows of £3.5bn1 (2010: £4.9bn1), representing an annualised 7%1 of opening AUM, with average revenue basis points increased to 37bps (2010: 35bps)

 

 

David Nish, Chief Executive, commented:

"Standard Life has performed well during the first nine months of this year and we remain on track to transform the operational and financial performance of the Group. We are strengthening our market positions and improving our efficiency to ensure we are competitively positioned for the important market and regulatory changes ahead of us.

 

"The third quarter saw very challenging conditions in global financial markets which have impacted values of assets and customer confidence, reducing the pace of fund flows. Our institutional and corporate business continued to grow, although at a slower rate, while inflows into retail propositions have held up well as we continued to add new customers and advisors to our platforms. Standard Life Investments has delivered positive net flows with particular success in the UK and Europe. Assets under administration and revenues have remained resilient due to our diverse asset mix.

 

"Although the economic backdrop continues to be uncertain, the outlook for our business is positive and we are confident in the future growth opportunities in our chosen markets."

    

     

 

     

 

Unless otherwise stated all comparisons are in Sterling and are for the nine months ended 30 September 2010.


Sustained growth in challenging market conditions

Assets under administration

1 Jan 2011

Gross inflows

Redemptions

Net
inflows

Market and other movements4

30 Sep 2011

Fee business (£bn)

163.1

19.1

(14.0)

5.1

(11.9)

156.3

Spread/risk business (£bn)

23.5

1.1

(1.9)

(0.8)

0.7

23.4

Other (£bn)3

10.2

0.3

(0.1)

0.2

1.0

11.4

Group AUA (£bn)

196.8

20.5

(16.0)

4.5

(10.2)

191.1

 

Net flows

9 months 2011

9 months 2010

Fee business1 (£bn)

5.1

6.5

Spread/risk business (£bn)

(0.8)

(0.9)

 

Group assets under administration decreased by 2.9% and now stand at £191.1bn. Net inflows into our newer fee based propositions of £5.1bn1 were strong, though lower. Long-term savings net inflows, excluding conventional with profits, increased by 5% to £4.4bn2 while Standard Life Investments third party net inflows of £3.5bn1 represented an annualised 7%1 of opening AUM. The impact of negative market movements in the period was partly mitigated by our relatively resilient asset mix. Market and other movements include the transfer, in the first half of this year, of approximately £4bn of UK money market funds following our decision to exit this sector of the industry.

Capital strength maintained

Standard Life has a robust capital position, which, assisted by the de-risking of the business carried out over the last few years, has been largely insensitive to market movements even in the volatile financial market conditions seen in the last quarter. Direct shareholder exposure to debt issued by governments and banks in Greece, Ireland, Italy, Portugal and Spain is less than £50m. Our estimated IGD surplus of £3.3bn (31 December 2010: £3.9bn) reflects our decision to successfully tender for €687m of the lower tier two subordinated liabilities. We will continue to look for opportunities to drive our capital efficiency and improve return on equity. 

Outlook

In the short-term, economic uncertainty and volatile conditions in global capital markets will inevitably mean that the operating conditions which we face will be challenging. However, in spite of these headwinds, we expect to continue to make progress both at an operating level and in fulfilling our strategic objective of transforming the Group.

We remain confident that the underlying demographic and regulatory trends in our key markets, and our customers' demand for our propositions, will drive our future growth.

In the UK, we are entering a period of unprecedented change and potential for growth. With the Retail Distribution Review (RDR) less than 15 months away, our retail business has scale and momentum and is ideally positioned to continue to drive asset growth through our leading platform propositions. The quality of our corporate pension offering together with the opportunities created by the RDR and pensions reform will provide us with an increased flow of new business over the medium to long term.

The prospects for Standard Life Investments remain strong. The business is well positioned across a diversified range of asset classes and provides the investment solutions expertise which continues to allow the Group to capture a greater proportion of the platform value chain.

We see significant opportunities in all our core markets and are confident that the investments we are making will lead to continued strong growth in assets and ongoing improvements in efficiency. By delivering on our strategy we have the potential to grow our profits significantly and increase the return for our shareholders.

UK

Continuing to build on our advantage in our chosen markets


1 Jan 2011

Gross inflows

Redemptions

Net
inflows

Market and other movements

30 Sep 2011

UK fee business (£bn)

76.2

8.2

(5.9)

2.3

(4.9)

73.6

Institutional pensions (£bn)

15.8

2.5

(1.4)

1.1

(0.4)

16.5

Conventional with profits (excl. annuities) (£bn)

6.6

0.1

(1.2)

(1.1)

-

5.5

UK fee business total

98.6

10.8

(8.5)

2.3

(5.3)

95.6

Spread/risk business AUA (£bn)

13.4

0.4

(0.9)

(0.5)

0.9

13.8

Total AUA backing products (£bn)

112.0

11.2

(9.4)

1.8

(4.4)

109.4

Fee business revenue (bps)

77





75

UK fee business AUA of £95.6bn reflects continued net inflows and the relative resilience of the AUA mix to equity market movements. Fee business net inflows, in the first nine months of the year, into our core retail and corporate pension propositions5 increased by 48% to £2.3bn. Net inflows in the quarter amounted to £0.5bn (2010: £0.5bn) reflecting the impact of volatility in financial markets. The average revenue yield across our UK fee business was 75bps (2010: 77bps).

Retail business with scale, momentum and market leading propositions

With RDR approaching quickly, our retail fee business continues to perform well with gross inflows up 6% to £5.2bn in the first nine months of the year (2010: £5.0bn). Despite the significant levels of volatility in financial markets gross inflows in the quarter were up 1% to £1.5bn (2010: £1.5bn). Net inflows in the first nine months of the year, excluding conventional with profits, increased by 51% to £689m.

Our award winning platforms continue to attract customers, advisors and assets, as we enhance further the features and usability of our technology. Collectively, our platforms now account for 194,200 customers with total platform assets under administration of £10.6bn. The number of adviser firms on the Wrap has increased to 969 (2010: 772), with an average AUA of £7.9m per firm (2010: £6.7m).

Total SIPP customers increased to 127,700, an increase of 26% year-on-year and 19% since the start of 2011. Our SIPP proposition continues to perform well as we maintain our impressive market share, helping to increase AUA to £15.9bn in spite of significant volatility in financial markets.

Standard Life Wealth continues to build a strong presence in the IFA market with the launch of the Managed Portfolio Service, and now has over £800m of AUA.

Gross inflows into annuities in the quarter increased by 16% to £123m (2010: £106m) reflecting the impact of the actions we have taken to increase sales. New business slowed in September as customers chose to defer their retirement rather than crystallise market losses due to current markets. Spread/risk business AUA increased to £13.8bn, reflecting falling yields on debt securities which were offset by overall net outflows driven by scheduled annuity payments.

Corporate business positioned for growth from market and regulatory trends

Corporate pension gross inflows in the first nine months of the year, excluding Trustee Investment Plan business of Standard Life Investments, were up 33% to £3.1bn (2010: £2.4bn), while net inflows increased by 46% to £1.6bn (2010: £1.1bn). Net inflows in the quarter of £356m (2010: £336m) reflected steady contributions into existing schemes and fewer scheme implementations compared to the first six months of the year as we continue to attract premium quality new business.

We have continued to build on our momentum by winning 123 new schemes in the year to date (2010: 125 schemes) while 59,000 new employees joined schemes implemented in the first nine months of this year (2010: 40,000 employees).

Earlier in the year we announced the launch of Lifelens, our market-leading fully integrated employee-centric offering providing employee pension and non-pension benefit solutions via the workplace. As previously mentioned, we continue to streamline our approach to implementation of Lifelens schemes and expect the next wave of clients to transition in 2012. 

We continue to build strong relationships with employers and corporate benefit consultants and are working with them to ensure that we have the most comprehensive and attractive solution to address the challenges of auto-enrolment ahead of the launch in the second half of 2012. This, combined with the quality of our propositions and the high levels of customer service we offer, positions us well for both pensions reform and RDR. We are working on our existing pipeline of schemes and are seeing strong levels of enquiries which will drive further growth in our business.



Global investment management

Positive net inflows and increasing revenue margin in difficult market conditions


1 Jan 2011

Gross inflows

Redemptions

Net
inflows

Market and other movements

30 Sep 2011

Fee business (£bn)

71.6

10.2

(6.7)

3.5

(6.0)

69.1

Fee business excl. Global Liquidity Funds (£bn)

67.7

10.2

(6.7)

3.5

(2.1)

69.1

Fee business revenue (bps)

35





37

Standard Life Investments has delivered positive net inflows despite highly volatile markets and very challenging market conditions faced by the investment management sector during the first nine months of the year. Third party fee business AUM, excluding the Global Liquidity Funds transferred earlier in the year to Deutsche Asset Management, increased from £67.7bn to £69.1bn. The increase was driven by net inflows of £3.5bn1 (2010: £4.9bn1), which represented an annualised 7%1 of opening third party AUM, which were partly offset by negative market movements.

GARS has now achieved AUM of over £11.5bn and we continue to see demand in UK and Europe as investors increasingly seek investment solutions that help reduce volatility within their portfolios. We have also seen continued success in UK wholesale with net inflows of £1.6bn during the first nine months of the year (2010: £1.5bn). SICAV sales, predominately in mainland Europe, have remained extremely buoyant at £0.4bn matching the record sales achieved in 2010. The suite of MyFolio managed funds continues to prove popular having attracted £0.7bn of assets since the funds were launched in the last quarter of 2010, including net flows in the quarter of £150m.

The average revenue yield across our third party business has increased to 37bps (2010: 35bps), excluding the fee received from the transfer of the money market business, reflecting our success in attracting higher revenue margin business. 

Although investment conditions have been difficult, longer term investment performance continues to be robust with the money-weighted average for third party assets above median over three, five and ten years. The strength of our mutual fund and unit trust range is demonstrated by the proportion of eligible and actively managed funds (23 out of 29) rated 'A' or above by Standard & Poor's in the UK.

Canada

Continued growth in fee business and group insurance sales


1 Jan 2011

Gross inflows

Redemptions

Net
inflows

Market and other movements

30 Sep 2011

Fee business AUA (£bn)

14.0

1.8

(1.4)

0.4

(1.2)

13.2

Spread/risk business AUA (£bn)

10.1

0.7

(1.0)

(0.3)

(0.2)

9.6

Total AUA backing products (£bn)

24.1

2.5

(2.4)

0.1

(1.4)

22.8

Fee business revenue (bps)

118





118

Fee business AUA in Canada has decreased by 3%6 to £13.2bn due to negative market movements, partly offset by net inflows. Strong sales and market share growth in our retail segregated funds were offset by an increase in mutual fund net outflows. While retention is improving since the first quarter of the year, withdrawals in funds in the first nine months were higher than last year. Group savings fee business net inflows of £336m were 12%6 lower than the comparative period of 2010 which included two large scheme wins. Net inflows in our core Defined Contribution proposition increased by 8%6, from increased renewal flows.

The average revenue yield on fee business has remained stable at 118bps (2010: 118bps).

Within Canada spread/risk business, the group insurance and disability management business continues to perform well with PVNBP sales up 55%6 to £681m and strong growth in market share. A large part of these sales consisted of future renewal premiums and as such had a marginal impact on inflows. AUA has decreased to £9.6bn driven by market movements and scheduled outflows in our annuity back book.

International

Growth in net flows in Ireland, Hong Kong and joint venture businesses


1 Jan 2011

Gross inflows

Redemptions

Net
inflows

Market and other movements

30 Sep 2011

Wholly owned fee business AUA (£bn)

11.1

1.8

(0.6)

1.2

(0.4)

11.9

India and China JV businesses AUA (£bn)

1.2

0.3

(0.1)

0.2

(0.2)

1.2

Fee business revenue (bps)

212





188

 

 

Fee business AUA across our wholly owned International operations increased by 7% to £11.9bn driven by higher net inflows partly offset by negative market movements.

Ireland net flows increased by 39% to £650m reflecting continued success of our domestic and offshore bonds businesses, although net flows in the domestic business slowed in the quarter driven by increased competition in the market and the impact of austerity measures such as the pension levy. International Bond AUA exceeded £2bn helped by growth in the discretionary fund management and wealth management sectors. Flows in Hong Kong almost tripled, assisted by our popular Harvest propositions. The average revenue yield across International wholly owned businesses was lower at 188bps (2010: 212bps), reflecting the continuing shift in both sales and back book mix across International.

Net flows in the India and China joint venture businesses increased to £207m (2010: £193m), a strong result given the regulatory changes introduced in India in the second half of 2010. HDFC Life performed strongly, increasing market share and securing second place in the private sector overall.

 



For further information please contact:

Institutional Equity Investors

Retail Equity Investors

Jakub Rosochowski

0131 245 8028/07515 298 608

Capita Registrars

0845 113 0045

Media


Debt Investors


Nicola McGowan

0131 245 4016/07872 191 341

Scott Forrest

0131 245 6045

Barry Cameron

0131 245 6165/07712 486 463

Nick Mardon

0131 245 6371

Susanna Voyle
(Tulchan Communications)

020 7353 4200/07980 894 557



 

Newswires and online publications

There will be a conference call today for newswires and online publications at 7:30am (UK time) hosted by Jackie Hunt, Chief Financial Officer, and Paul Matthews, UK Chief Executive. Dial in telephone number +44 (0)1452 555 566. Callers should quote Standard Life Media call. The conference ID number is 20607993.

 

Investors and Analysts

There will be a conference call today for analysts and investors at 9:30am (UK time) hosted by Jackie Hunt, Chief Financial Officer, and Paul Matthews, UK Chief Executive. Dial in telephone number +44 (0)1452 555 566. Callers should quote Standard Life Analysts & Investors call. The conference ID number is 20466532. A recording of this call will be available for replay for one week by dialling +44 (0)1452 550 000 (access code 204665532#).

 

Notes to Editors:

1

Excluding Global Liquidity Funds transferred to Deutsche Asset Management

2

In order to be consistent with the presentation of new business information, certain products are included in both long-term savings and investments AUA and net flows.

3

Other assets included within AUA of £11.4bn (31 December 2010: £10.2bn) comprise assets not backing products, joint ventures, non-life assets and consolidation / elimination adjustments.

4

Comprises market and other movements including the transfer of our UK money market funds following our decision to exit this sector of the industry

5

Comprises UK retail fee business excluding conventional with profits, UK corporate pensions excluding institutional pensions

6

On a constant currency basis

 


Group assets under administration (summary)

Nine months ended 30 September 2011


Opening AUA at

1 Jan 2011

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Closing

AUA at

30 Sep 2011


£bn

£bn

£bn

£bn

£bn

£bn

Fee business







UK

76.2

8.2

(5.9)

2.3

(4.9)

73.6

Institutional pensions

15.8

2.5

(1.4)

1.1

(0.4)

16.5

Conventional with profits (excluding annuities)

6.6

0.1

(1.2)

(1.1)

-

5.5

UK total

98.6

10.8

(8.5)

2.3

(5.3)

95.6

Canada

14.0

1.8

(1.4)

0.4

(1.2)

13.2

International (wholly owned)

11.1

1.8

(0.6)

1.2

(0.4)

11.9

Standard Life Investments third party

71.6

10.2

(6.7)

3.5

(6.0)

69.1

Consolidation/eliminations1

(32.2)

(5.5)

3.2

(2.3)

1.0

(33.5)

Total fee business

163.1

19.1

(14.0)

5.1

(11.9)

156.3








Spread/risk







UK

13.4

0.4

(0.9)

(0.5)

0.9

13.8

Canada

10.1

0.7

(1.0)

(0.3)

(0.2)

9.6

Total spread/risk business

23.5

1.1

(1.9)

(0.8)

0.7

23.4








Assets not backing products

8.4

-

-

-

1.0

9.4

India and China JV businesses

1.2

0.3

(0.1)

0.2

(0.2)

1.2

Non-life assets

1.4

-

-

-

0.3

1.7

Other consolidation/eliminations1

(0.8)

-

-

-

(0.1)

(0.9)

Group assets under administration

196.8

20.5

(16.0)

4.5

(10.2)

191.1

1   In order to be consistent with the presentation of new business information, certain products are included in both life and pensions AUA and investment operations. Therefore, at a Group level an elimination adjustment is required to remove any duplication, in addition to other necessary consolidation adjustments.


Group assets under administration (summary)

Nine months ended 30 September 2010


Opening AUA at

1 Jan 2010

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Closing

AUA at

30 Sep 2010


£bn

£bn

£bn

£bn

£bn

£bn

Fee business







UK

66.6

7.1

(5.5)

1.6

4.3

72.5

Institutional pensions

12.0

2.7

(0.9)

1.8

1.3

15.1

Conventional with profits (excluding annuities)

6.9

0.2

(0.8)

(0.6)

0.5

6.8

UK total

85.5

10.0

(7.2)

2.8

6.1

94.4

Canada

11.3

1.7

(1.2)

0.5

1.2

13.0

International (wholly owned)

9.1

1.5

(0.6)

0.9

0.9

10.9

Standard Life Investments third party

56.9

10.5

(4.2)

6.3

5.9

69.1

Consolidation/eliminations1

(23.9)

(4.3)

1.7

(2.6)

(3.2)

(29.7)

Total fee business

138.9

19.4

(11.5)

7.9

10.9

157.7








Spread/risk







UK

13.1

0.4

(0.9)

(0.5)

1.4

14.0

Canada

9.2

0.6

(1.0)

(0.4)

1.1

9.9

Total spread/risk business

22.3

1.0

(1.9)

(0.9)

2.5

23.9








Assets not backing products

7.8

-

-

-

1.4

9.2

India and China JV businesses

0.8

0.3

(0.1)

0.2

0.1

1.1

Non-life assets

1.6

-

-

-

(0.2)

1.4

Other consolidation/eliminations1

(1.3)

-

-

-

0.4

(0.9)

Group assets under administration

170.1

20.7

(13.5)

7.2

15.1

192.4

1   In order to be consistent with the presentation of new business information, certain products are included in both life and pensions AUA and investment operations. Therefore, at a Group level an elimination adjustment is required to remove any duplication, in addition to other necessary consolidation adjustments.

 


Group assets under administration

Nine months ended 30 September 2011


Fee (F) - Spread/risk (S/R)

Opening AUA at

1 Jan 2011

Gross

inflows

Redemptions

Net

inflows

Market and other

movements

Closing

AUA at

30 Sep 2011


£bn

£bn

£bn

£bn

£bn

£bn

UK








Individual SIPP

F

 15.1

 2.7

(1.2)

 1.5

(0.7)

 15.9

Other individual pensions

F

 23.6

 0.6

(1.8)

(1.2)

(0.8)

 21.6

Investment bonds

F

 8.7

 0.2

(0.9)

(0.7)

(0.5)

 7.5

Mutual funds

F

 5.3

 1.5

(0.3)

 1.2

(0.7)

 5.8

Annuities

S/R

 13.4

 0.4

(0.9)

(0.5)

 0.9

 13.8

Legacy life

F

 9.1

 0.2

(1.4)

(1.2)

(0.2)

 7.7

UK retail


 75.2

 5.6

(6.5)

(0.9)

(2.0)

 72.3

Corporate pensions

F

 21.0

 3.1

(1.5)

 1.6

(2.0)

 20.6

Institutional pensions

F

 15.8

 2.5

(1.4)

 1.1

(0.4)

 16.5

UK corporate


 36.8

 5.6

(2.9)

 2.7

(2.4)

 37.1

Assets not backing products


 7.2

                        -

                        -

                        -

 0.6

 7.8

UK long-term savings


 119.2

 11.2

(9.4)

 1.8

(3.8)

 117.2









Canada








Fee

F

 10.7

 1.2

(0.9)

 0.3

(1.0)

 10.0

Spread/risk

S/R

 3.6

 0.2

(0.3)

(0.1)

 0.1

 3.6

Group savings and retirement


 14.3

 1.4

(1.2)

 0.2

(0.9)

 13.6

Fee

F

 1.7

 0.4

(0.2)

 0.2

(0.2)

 1.7

Spread/risk

S/R

 5.9

 0.2

(0.4)

(0.2)

(0.2)

 5.5

Individual insurance, savings and retirement


 7.6

 0.6

(0.6)

                        -

(0.4)

 7.2

Group insurance

S/R

 0.6

 0.3

(0.3)

 -

(0.1)

 0.5

Mutual funds

F

 1.6

 0.2

(0.3)

(0.1)

                        -

 1.5

Assets not backing products


 1.2

                        -

                        -

                        -

 0.4

 1.6

Canada long-term savings


 25.3

 2.5

(2.4)

 0.1

(1.0)

 24.4









International








Ireland

F

 6.0

 1.2

(0.5)

 0.7

(0.3)

 6.4

Germany

F

 5.0

 0.6

(0.1)

 0.5

                        (0.1)

 5.4

Hong Kong

F

 0.1

                        -

                        -

                        -

                        -

 0.1

Wholly owned long-term savings


 11.1

 1.8

(0.6)

 1.2

(0.4)

 11.9

Joint ventures long-term savings


 1.2

 0.3

(0.1)

 0.2

(0.2)

 1.2

International long-term savings


 12.3

 2.1

(0.7)

 1.4

(0.6)

 13.1

Total worldwide long-term savings


 156.8

 15.8

(12.5)

 3.3

(5.4)

 154.7

Non-life assets


 1.4

                        -

                        -

                        -

 0.3

 1.7

Standard Life Investments third party assets under management


 71.6

 10.2

(6.7)

 3.5

(6.0)

 69.1

Consolidation and elimination adjustments1


(33.0)

(5.5)

 3.2

(2.3)

 0.9

(34.4)

Group assets under administration


 196.8

 20.5

(16.0)

 4.5

(10.2)

 191.1









Group assets under administration managed by:








Standard Life Group entities


 164.0





 158.0

Other third party managers


 32.8





 33.1

Total


 196.8





 191.1

1      In order to be consistent with the presentation of new business information, certain products are included in both life and pensions AUA and investment operations. Therefore, at a Group level an elimination adjustment is required to remove any duplication, in addition to other necessary consolidation adjustments.


Long-term savings operations net flows (regulatory basis)

Nine months ended 30 September 2011



Gross inflows

Redemptions

Net inflows

Gross inflows

Redemptions

Net inflows


Fee (F) - Spread/risk (S/R)

9 months to

30 Sep 2011

9 months to

30 Sep 2011

9 months to

30 Sep 2011

9 months to

30 Sep 2010

9 months to

30 Sep 2010

9 months to

30 Sep 2010


£m

£m

£m

£m

£m

£m

UK








Individual SIPP1

F

2,774

(1,230)

1,544

2,641

(1,137)

1,504

Other individual pensions

F

608

(1,846)

(1,238)

673

(1,921)

(1,248)

Investment bonds

F

167

(892)

(725)

180

(786)

(606)

Mutual funds1

F

1,474

(305)

1,169

1,194

(332)

862

Annuities

S/R

340

(851)

(511)

393

(851)

(458)

Protection

S/R

57

(38)

19

63

(43)

20

Legacy life

F

226

(1,374)

(1,148)

263

(1,002)

(739)

UK retail


5,646

(6,536)

(890)

5,407

(6,072)

(665)

Corporate pensions1

F

3,133

(1,512)

1,621

2,351

(1,242)

1,109

Institutional pensions

F

2,463

(1,356)

1,107

2,676

(864)

1,812

UK corporate


5,596

(2,868)

2,728

5,027

(2,106)

2,921

UK long-term savings2


11,242

(9,404)

1,838

10,434

(8,178)

2,256









Canada








Fee

F

1,199

(863)

336

1,103

(727)

376

Spread/risk

S/R

154

(328)

(174)

126

(300)

(174)

Group savings and retirement


1,353

(1,191)

162

1,229

(1,027)

202

Fee

F

394

(249)

145

309

(191)

118

Spread/risk

S/R

235

(411)

(176)

200

(468)

(268)

Individual insurance, savings and retirement


629

(660)

(31)

509

(659)

(150)

Group insurance

S/R

330

(267)

63

307

(246)

61

Mutual funds1

F

167

(254)

(87)

248

(268)

(20)

Canada long-term savings


2,479

(2,372)

107

2,293

(2,200)

93









International








Ireland

F

1,162

(512)

650

891

(424)

467

Germany

F

582

(149)

433

559

(93)

466

Hong Kong

F

61

(16)

45

23

(5)

18

Wholly owned long-term savings


1,805

(677)

1,128

1,473

(522)

951

Joint ventures long-term savings3


316

(109)

207

276

(83)

193

International long-term savings


2,121

(786)

1,335

1,749

(605)

1,144

Total worldwide long-term savings

15,842

(12,562)

3,280

14,476

(10,983)

3,493

1    The mutual funds net flows are also included within mutual funds net flows in the third party investment operations. In addition, an element of the UK non-insured SIPP is included within UK mutual funds net flows in the third party investment operations.

2    UK long-term savings include a total net outflow of £1,719m in relation to conventional with profits business (2010: net outflow £1,329m). Of this, a net outflow of £632m is in relation to annuities business (2010: net outflow £646m).

3    Includes net flows in respect of Standard Life's share of the India and China JV businesses.


Long-term savings operations net flows (regulatory basis)

Three months ended 30 September 2011



Gross inflows

Redemptions

Net inflows

Gross inflows

Redemptions

Net inflows


Fee (F) - Spread/risk (S/R)

3 months to

30 Sep 2011

3 months to

30 Sep 2011

3 months to

30 Sep 2011

3 months to

30 Sep 2010

3 months to

30 Sep 2010

3 months to

30 Sep 2010


£m

£m

£m

£m

£m

£m

UK








Individual SIPP1

F

846

(381)

465

773

(327)

446

Other individual pensions

F

160

(567)

(407)

178

(553)

(375)

Investment bonds

F

51

(294)

(243)

65

(259)

(194)

Mutual funds1

F

420

(94)

326

425

(124)

301

Annuities

S/R

123

(287)

(164)

106

(279)

(173)

Protection

S/R

18

(12)

6

21

(14)

7

Legacy life

F

71

(573)

(502)

85

(358)

(273)

UK retail


1,689

(2,208)

(519)

1,653

(1,914)

(261)

Corporate pensions1

F

953

(597)

356

888

(552)

336

Institutional pensions

F

677

(382)

295

783

(237)

546

UK corporate


1,630

(979)

651

1,671

(789)

882

UK long-term savings2


3,319

(3,187)

132

3,324

(2,703)

621









Canada








Fee

F

341

(252)

89

346

(263)

83

Spread/risk

S/R

54

(112)

(58)

42

(92)

(50)

Group savings and retirement


395

(364)

31

388

(355)

33

Fee

F

123

(71)

52

91

(58)

33

Spread/risk

S/R

68

(144)

(76)

66

(145)

(79)

Individual insurance, savings and retirement


191

(215)

(24)

157

(203)

(46)

Group insurance

S/R

109

(89)

20

102

(81)

21

Mutual funds1

F

47

(66)

(19)

66

(73)

(7)

Canada long-term savings


742

(734)

8

713

(712)

1









International








Ireland

F

303

(189)

114

329

(126)

203

Germany

F

193

(52)

141

183

(34)

149

Hong Kong

F

18

(3)

15

8

(1)

7

Wholly owned long-term savings


514

(244)

270

520

(161)

359

Joint ventures long-term savings3


105

(38)

67

93

(33)

60

International long-term savings


619

(282)

337

613

(194)

419

Total worldwide long-term savings


4,680

(4,203)

477

4,650

(3,609)

1,041

1    The mutual funds net flows are also included within mutual funds net flows in the third party investment operations. In addition, an element of the UK non-insured SIPP is included within UK mutual funds net flows in the third party investment operations.

2    UK long-term savings include a total net outflow of £689m in relation to conventional with profits business (2010: net outflow £467m). Of this, a net outflow of £210m relation to annuities business (2010: net outflow £213m).  

3    Includes net flows in respect of Standard Life's share of the India and China JV businesses.



Long-term savings operations net flows (regulatory basis)

15 months ended 30 September 2011



Net flows


Fee (F) - Spread/risk (S/R)

3 months to 30 Sep 2011

3 months to

30 Jun 2011

3 months to

31 Mar 2011

3 months to

31 Dec 2010

3 months to

30 Sep 2010


£m

£m

£m

£m

£m

UK







Individual SIPP

F

465

526

553

439

446

Other individual pensions

F

(407)

(359)

(472)

(411)

(375)

Investment bonds

F

(243)

(233)

(249)

(201)

(194)

Mutual funds

F

326

434

409

430

301

Annuities

S/R

(164)

(175)

(172)

(184)

(173)

Protection

S/R

6

8

5

8

7

Legacy life

F

(502)

(387)

(259)

(249)

(273)

UK retail


(519)

(186)

(185)

(168)

(261)

Corporate pensions

F

356

706

559

281

336

Institutional pensions

F

295

518

294

628

546

UK corporate


651

1,224

853

909

882

UK long-term savings


132

1,038

668

741

621








Canada







Fee

F

89

90

157

44

83

Spread/risk

S/R

(58)

(58)

(58)

(53)

(50)

Group savings and retirement


31

32

99

(9)

33

Fee

F

52

45

48

40

33

Spread/risk

S/R

(76)

(62)

(38)

(60)

(79)

Individual insurance, savings and

retirement


(24)

(17)

10

(20)

(46)

Group insurance

S/R

20

22

21

18

21

Mutual funds

F

(19)

(21)

(47)

(19)

(7)

Canada long-term savings


8

16

83

(30)

1








International







Ireland

F

114

242

294

244

203

Germany

F

141

152

140

200

149

Hong Kong

F

15

15

15

17

7

Wholly owned long-term savings


270

409

449

461

359

Joint ventures long-term savings1


67

38

102

61

60

International long-term savings


337

447

551

522

419

Total worldwide long-term savings


477

1,501

1,302

1,233

1,041

1    Includes net flows in respect of Standard Life's share of the India and China JV businesses.



Long-term savings operations new business

Nine months ended 30 September 2011



Single premiums

New regular premiums

PVNBP


Fee (F) - Spread/risk (S/R)

9 months

to 30 Sep

2011

9 months

to 30 Sep 2010

9 months

to 30 Sep

2011

9 months

to 30 Sep 2010

9 months

to 30 Sep

2011

9 months

to 30 Sep 2010

Change3

Change in constant currency3


£m

£m

£m

£m

£m

£m

%

%

UK










Individual SIPP1

F

2,478

54

2,841

7%

7%

Other individual pensions

F

299

18

324

(6%)

(6%)

Investment bonds

F

140

-

149

6%

6%

Mutual funds

F

1,176

18

1,607

23%

23%

Annuities

S/R

281

-

230

(18%)

(18%)

Protection

S/R

-

1

1

-

-

Legacy life

F

-

-

-

-

-

-

-

-

UK retail


4,718

4,374

99

91

5,152

4,740

9%

9%

Corporate pensions1

F

1,641

1,051

525

421

3,858

2,700

43%

43%

Institutional pensions

F

2,316

2,597

1

-

2,317

2,597

(11%)

(11%)

UK corporate


3,957

3,648

526

421

6,175

5,297

17%

17%

UK long-term savings


8,675

8,022

625

512

11,327

10,037

13%

13%











Canada







Fee

F

362

61

633

(39%)

(40%)

Spread/risk

S/R

58

34

4

9

103

132

(22%)

(23%)

Group savings and retirement


379

396

28

70

736

1,165

(37%)

(38%)

Fee

F

394

309

-

-

394

309

28%

25%

Spread/risk

S/R

154

119

4

3

190

148

28%

26%

Individual insurance, savings and retirement


548

428

4

3

584

457

28%

26%

Group insurance

S/R

3

2

43

27

681

433

57%

55%

Mutual funds

F

167

248

-

-

167

248

(33%)

(34%)

Canada long-term savings


1,097

1,074

75

100

2,168

2,303

(6%)

(7%)











International







Ireland

F

837

6

1,126

31%

30%

Germany

F

19

17

243

8%

6%

Hong Kong

F

21

7

36

26

254

192

32%

38%

Wholly owned long-term savings


1,150

863

59

49

1,623

1,275

27%

27%

India2


37

23

68

83

318

349

(9%)

(6%)

China2


28

28

8

10

69

76

(9%)

(10%)

Joint ventures long-term savings


65

51

76

93

387

425

(9%)

(6%)

International long-term savings


1,215

914

135

142

2,010

1,700

18%

19%

Total worldwide long-term savings


10,987

 10,010

835

754

15,505

14,040

10%

10%

1    Included within non-insured SIPP is an element which is also included within UK mutual funds net flows in the third party investment operations figure.

2    Standard Life's share of the joint venture company's new business.

3      % change is calculated on the figures rounded to millions.

4    New business gross sales for overseas operations are calculated using average exchange rates. The principal average rates for the nine months to 30 September 2011 were £1: C$1.58 (2010: £1: C$1.61) and £1: €1.15 (2010: £1: €1.16).



Investment operations

Nine months ended 30 September 2011



Opening AUM at

1 Jan 2011

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Net

movement

in AUM

Closing

AUM at

30 Sep 2011



£m

£m

£m

£m

£m

£m

£m

UK

Mutual funds1,2

9,179

3,583

(2,015)

1,568

(110)

1,458

10,637


Private equity

3,437

64

(64)

-

25

25

3,462


Segregated funds

13,979

239

(1,389)

(1,150)

(202)

(1,352)

12,627


Pooled property funds

1,702

236

-

236

38

274

1,976

Total UK

28,297

4,122

(3,468)

654

(249)

405

28,702

Canada

Mutual funds1,3

1,789

166

(254)

(88)

(147)

(235)

1,554


Separate mandates

3,443

474

(350)

124

16

140

3,583

Total Canada

5,232

640

(604)

36

(131)

(95)

5,137

International

Europe

3,806

1,240

(553)

687

364

1,051

4,857


India4

3,392

196

-

196

(586)

(390)

3,002


Other

1,131

23

-

23

(309)

(286)

845

Total International

8,329

1,459

(553)

906

(531)

375

8,704










Total worldwide investment products excluding money market and related funds

41,858

6,221

(4,625)

1,596

(911)

685

42,543


UK money market funds5

3,953

-

-

-

(3,900)

(3,900)

53


India cash funds5

1,435

187

-

187

(84)

103

1,538

Total worldwide investment products

47,246

6,408

(4,625)

1,783

(4,895)

(3,112)

44,134

Total third party assets under management comprise the investment business noted above together with third party insurance contracts. New business relating to third party insurance contracts is disclosed as insurance business for reporting purposes. An analysis of total third party assets under management is shown below.


Opening AUM at

1 Jan 2011

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Net

movement

in AUM

Closing

AUM at

30 Sep 2011


£m

£m

£m

£m

£m

£m

£m

Third party investment products

47,246

6,408

(4,625)

1,783

(4,895)

(3,112)

44,134

Third party insurance contracts (new business classified as insurance products)

24,367

3,760

(2,103)

1,657

(1,062)

595

24,962

Total third party assets under management

71,613

10,168

(6,728)

3,440

(5,957)

(2,517)

69,096

UK money market funds and India cash funds5

5,388

187

-

187

(3,984)

(3,797)

1,591

Total third party assets under management excluding money market and related funds

66,225

9,981

(6,728)

3,253

(1,973)

1,280

67,505









Standard Life Investments - total assets under management

156,874






149,838

1      Included within mutual funds are cash inflows which have also been reflected in UK and Canada mutual funds new business sales and net flows for UK mutual funds, an element of UK non-insured SIPP and Canada mutual funds.

2    In the nine months to 30 September 2010, UK mutual funds gross inflows were £2,599m and net inflows were £1,471m. 

3    In the nine months to 30 September 2010, Canada mutual funds gross inflows were £241m and net outflows were £19m.

4    International gross inflows include India where, due to the nature of the Indian investment sales market, the new business is shown as the net of sales less redemptions. India cash funds are included as money market and related funds in the table.

5    Due to the nature of the UK money market funds and India cash funds, the flows are calculated using average net client balances. Other movements are derived as the difference between these average net inflows and the movement in the opening and closing AUM. Market and other movements includes the transfer of UK money market funds in Global Liquidity Fund to Deutsche Bank Asset Management, as a result of Standard Life Investments withdrawal from constant net asset value money market funds.       

6      Funds denominated in foreign currencies have been translated to Sterling using the closing exchange rates at 30 September 2011. Investment fund flows are translated at average exchange rates. Gains and losses arising from the translation of funds denominated in foreign currencies are included in the market and other movements column. The principal closing exchange rates used as at 30 September 2011 were £1: C$1.62 (31 December 2010: £1: C$1.56) and £1: €1.16 (31 December 2010: £1: €1.17). The principal average exchange rates for the nine months to 30 September 2011 were £1: C$1.58 (2010: £1: C$1.61) and £1: €1.15 (2010: £1: €1.16).



Long-term savings operations new business

Three months ended 30 September 2011



Single premiums

New regular premiums

PVNBP


Fee (F) - Spread/risk (S/R)

3 months

to 30 Sep

2011

3 months

to 30 Sep

2010

3 months

to 30 Sep

2011

3 months

to 30 Sep

2010

3 months

to 30 Sep

2011

3 months

to 30 Sep

2010

Change3

Change in constant currency3


£m

£m

£m

£m

£m

£m

%

%

UK










Individual SIPP1

F

783

704

18

15

857

757

13%

13%

Other individual pensions

F

57

67

5

5

71

80

(11%)

(11%)

Investment bonds

F

43

49

-

-

44

49

(10%)

(10%)

Mutual funds

F

416

422

5

3

455

445

2%

2%

Annuities

S/R

83

72

-

-

83

72

15%

15%

Protection

S/R

-

-

-

1

-

-

-

-

Legacy life

F

-

-

-

-

-

-

-

-

UK retail


1,382

1,314

28

24

1,510

1,403

8%

8%

Corporate pensions1

F

415

442

136

126

1,028

949

8%

8%

Institutional pensions

F

643

762

-

(3)

643

755

(15%)

(15%)

UK corporate


1,058

1,204

136

123

1,671

1,704

(2%)

(2%)

UK long-term savings


2,440

2,518

164

147

3,181

3,107

2%

2%











Canada










Fee

F

74

113

4

22

132

344

(62%)

(62%)

Spread/risk

S/R

24

15

1

3

33

48

(31%)

(32%)

Group savings and retirement


98

128

5

25

165

392

(58%)

(58%)

Fee

F

123

91

-

-

123

91

35%

32%

Spread/risk

S/R

41

40

3

1

59

48

23%

23%

Individual insurance, savings and retirement


164

131

3

1

182

139

31%

29%

Group insurance

S/R

1

1

13

8

195

125

56%

53%

Mutual funds

F

47

66

-

-

47

66

(29%)

(30%)

Canada long-term savings


310

326

21

34

589

722

(18%)

(20%)











International










Ireland

F

287

307

1

2

290

313

(7%)

(9%)

Germany

F

8

7

6

6

81

71

14%

11%

Hong Kong

F

8

2

10

8

77

59

31%

33%

Wholly owned long-term savings


303

316

17

16

448

443

1%

-

India2


8

4

24

28

106

116

(9%)

(5%)

China2


8

9

2

3

20

21

(5%)

(13%)

Joint ventures long-term savings


16

13

26

31

126

137

(8%)

(6%)

International long-term savings


319

329

43

47

574

580

(1%)

(2%)

Total worldwide long-term savings


3,069

3,173

228

228

4,344

4,409

(1%)

(2%)

1    Included within non-insured SIPP is an element which is also included within UK mutual funds net flows in the third party investment operations figures.           

2    Standard Life's share of the joint venture company's new business.

3    % change is calculated on the figures rounded to millions.                                                                  

4    New business gross sales for overseas operations are calculated using average exchange rates. The principal average rates for the nine months to 30 September 2011 were £1: C$1.58 (2010: £1: C$1.61) and £1: €1.15 (2010: £1: €1.16).


Investment operations

Three months ended 30 September 2011



Opening

AUM at

1 Jul 2011

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Net

movement

in AUM

Closing

AUM at

30 Sep 2011



£m

£m

£m

£m

£m

£m

£m

UK

Mutual funds1,2

10,833

817

(706)

111

(307)

(196)

10,637


Private equity

3,459

55

(14)

41

(38)

3

3,462


Segregated funds

13,167

85

(152)

(67)

(473)

(540)

12,627


Pooled property funds

1,949

7

-

7

20

27

1,976

Total UK

29,408

964

(872)

92

(798)

(706)

28,702

Canada

Mutual funds1,3

1,763

44

(63)

(19)

(190)

(209)

1,554


Separate mandates

3,742

123

(210)

(87)

(72)

(159)

3,583

Total Canada

5,505

167

(273)

(106)

(262)

(368)

5,137

International

Europe

4,920

407

(236)

171

(234)

(63)

4,857


India4

3,248

134

-

134

(380)

(246)

3,002


Other

1,128

2

-

2

(285)

(283)

845

Total International

9,296

543

(236)

307

(899)

(592)

8,704










Total worldwide investment products excluding money market and related funds

44,209

1,674

(1,381)

293

(1,959)

(1,666)

42,543


UK money market funds5

53

-

-

-

-

-

53


India cash funds5

1,727

(266)

-

(266)

77

(189)

1,538

Total worldwide investment products

45,989

1,408

(1,381)

27

(1,882)

(1,855)

44,134

Total third party assets under management comprise the investment business noted above together with third party insurance contracts. New business relating to third party insurance contracts is disclosed as insurance business for reporting purposes. An analysis of total third party assets under management is shown below.


Opening AUM at

1 Jul 2011

Gross

inflows

Redemptions

Net

inflows

Market and

other

movements

Net

movement

in AUM

Closing

AUM at

30 Sep 2011


£m

£m

£m

£m

£m

£m

£m

Third party investment products

45,989

1,408

(1,381)

27

(1,882)

(1,855)

44,134

Third party insurance contracts (new business classified as insurance products)

25,654

1,142

(670)

472

(1,164)

(692)

24,962

Total third party assets under management

71,643

2,550

(2,051)

499

(3,046)

(2,547)

69,096

UK money market funds and India cash funds5

1,780

(266)

-

(266)

77

(189)

1,591

Total third party assets under management excluding money market and related funds

69,863

2,816

(2,051)

765

(3,123)

(2,358)

67,505









Standard Life Investments - total assets under management

157,014






149,838

1    Included within mutual funds are cash inflows which have also been reflected in UK and Canada mutual funds new business sales and net flows for UK mutual funds, an element of UK non-insured SIPP and Canada mutual funds.

2    In the three months to 30 September 2010, UK mutual funds gross inflows were £1,142m and net inflows were £758m. 

3    In the three months to 30 September 2010, Canada mutual funds gross inflows were £63m and net outflows were £6m.  

4    International gross inflows include India where, due to the nature of the Indian investment sales market, the new business is shown as the net of sales less redemptions. India cash funds are included as money market and related funds in the table.

5    Due to the nature of the UK money market funds and India cash funds, the flows are calculated using average net client balances. Other movements are derived as the difference between these average net inflows and the movement in the opening and closing AUM.

6    Funds denominated in foreign currencies have been translated to Sterling using the closing exchange rates at 30 September 2011. Investment fund flows are translated at average exchange rates. Gains and losses arising from the translation of funds denominated in foreign currencies are included in the market and other movements column. The principal closing exchange rates used as at 30 September 2011 were £1: C$1.62 (30 June 2011: £1: C$1.55) and £1: €1.16 (30 June 2011: £1: €1.11). The principal average exchange rates for the nine months to 30 September 2011 were £1: C$1.58 (2010: £1: C$1.61) and £1: €1.15 (2010: £1: €1.16).


Long-term savings operations new business

15 months ended 30 September 2011



PVNBP


Fee (F) - Spread/risk (S/R)

3 months to 30 Sep 2011

3 months to 30 Jun 2011

3 months to 31 Mar 2011

3 months to

31 Dec 20101

3 months to

30 Sep 2010


£m

£m

£m

£m

£m

UK







Individual SIPP

F

857

978

1,006

770

757

Other individual pensions

F

71

155

98

54

80

Investment bonds

F

44

51

54

62

49

Mutual funds

F

455

584

568

483

445

Annuities

S/R

83

74

73

60

72

Protection

S/R

-

1

-

-

-

Legacy life

F

-

-

-

-

-

UK retail


1,510

1,843

1,799

1,429

1,403

Corporate pensions

F

1,028

1,536

1,294

502

949

Institutional pensions

F

643

802

872

875

755

UK corporate


1,671

2,338

2,166

1,377

1,704

UK long-term savings


3,181

4,181

3,965

2,806

3,107








Canada







Fee

F

132

124

377

185

344

Spread/risk

S/R

33

22

48

26

48

Group savings and retirement


165

146

425

211

392

Fee

F

123

128

143

129

91

Spread/risk

S/R

59

54

77

76

48

Individual insurance, savings and retirement


182

182

220

205

139

Group insurance

S/R

195

162

324

174

125

Mutual funds

F

47

54

66

65

66

Canada long-term savings


589

544

1,035

655

722








International







Ireland

F

290

386

450

438

313

Germany

F

81

90

72

113

71

Hong Kong

F

77

78

99

124

59

Wholly owned long-term savings


448

554

621

675

443

India2


106

62

150

95

116

China2


20

23

26

41

21

Joint ventures long-term savings


126

85

176

136

137

International long-term savings


574

639

797

811

580

Total worldwide long-term savings


4,344

5,364

5,797

4,272

4,409

1    The three month period to 31 December 2010 excludes the full impact of year end changes to non-economic assumptions. The effect of changes to year end non-economic assumptions was an increase in total PVNBP of £171m in the final PVNBP results published in the 2010 Preliminary results.

2    Amounts shown reflect Standard Life's share of the joint venture company's new business.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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