M&G’s decision to merge its wealth and life businesses, and get rid of its adviser platform, can be seen in the context of the platform and the wider wealth businesses losing a combined £9mn in the six months to the end of June 2024.
However, the losses were significantly lower than the £19mn lost in the same six month period in 2023 and comes in the context of a loss of £32mn for the whole of 2023.
In its half year accounts, released on Wednesday (September 5), the company attributed the reduced losses to measures it had taken to cut costs.
The assets under administration for the combined wealth and advice business was £21.8bn at the end of June 2024, compared with £19.2bn at the start of 2024.
Just £100mn of the increase came from net new money being put either on to the platform or with the advisers and the remaining £2.5bn was a result of market movements, that is, rising asset prices.
The company does not break down the losses or assets attributable to either the platform or the advice businesses, which includes the tied advice business, a stake in Continiuum, and Sandringham, and other units.
Of the £21.8bn of assets under management in the wealth business, £5.3bn relates to assets under advice, a steep increase on the £2.9bn reported at the end of 2023.
This is likely the result of the company further consolidating the assets of the Continuum advice business into the wider group.
This activity was described in the results as helping to offset outflows in other parts of the business.
The Ascentric platform has assets under administration of around £15bn. M&G bought Ascentric from Royal London in 2020.
In the results announcement M&G announced it intends to exit the platform business, as it feels the necessary scale can only be achieved with a significant level of extra investment that it is not right now prepared to make.
The company said combining the two business areas will increase efficiency and reduce duplication.
Caroline Connellan, who joined M&G as head of the wealth business, will depart as a result of the merger, with Clive Bolton, current chief executive of the life business, becoming responsible for both business areas.
Bolton joined M&G in 2023, having previously worked at LV= and is also chairman of the Civil Service Pension scheme advisory board.
The advice and platform business currently operate within a division the company calls 'wealth' which also includes the Prufunds business.
This had assets under management of £56.4bn at the end of June 2024, compared with £54.8bn at the start of 2024.
Again, this increase in assets came from positive market movements, as clients actually withdrew £500mn from the fund range in the six months.
But Prufund was still the driver of profit within the wealth business, with a profit of £96mn for the six month period, compared with a profit of £119mn for the same period in 2023.
Andrea Rossi, group chief executive officer, said: "We are continuing to push further on our strategic priorities, combining our Life and Wealth operations to support the acceleration of our growth plan in the UK retail market.
