Funds managed by European Wealth climbed by nearly 22 per cent last year, with the group expecting this to grow further in light of its takeover of one of Towry’s businesses.
The wealth manager saw funds under management hit £1.5bn at the end of last year, up from the £1.2bn posted in 2015, with a further £80m added to its books since the start of 2017.
Last year, European Wealth purchased a book of business from the Towry group which will add an extra £110m in FuM this year.
Towry was bought by Tilney Bestinvest for £600m in April last year.
In September, European Wealth also struck a £750,000 deal to acquire asset manager Cimco Partners Management.
According to a market update published today (10 February), the firm’s total revenue for last year is expected to reach £9.3m, climbing by almost a quarter from 2015’s figure of £7.6m.
John Morton, group chief executive of European Wealth, admitted the firm had a very difficult trading period in the second half of 2015, but said the performance improved over the course of last year.
The revenue was bolstered by the acquisitions, but it was also helped by the “encouragingly” strong performance of the investment management and dealing business, particularly in the aftermath of the Brexit vote, according to the statement.
The European Wealth chief said continuing changes within the industry – particularly those covered by MiFID II – are likely to throw up more acquisition opportunities.
However, he pointed out that the increase in the valuation of investment management and financial planning businesses has meant the board has decided to shift its focus towards organic growth over the short term.
“It is clear that the introduction of MiFID II together with continued pressure on investment management fees, will create a challenging environment over the coming 12 months,” he said.
“However, being a relatively young company with modern systems, we will be able to expand our margin as the business grows and funds under management increase,” he said, pointing to his plans to continue to invest in the company’s infrastructure and staff.
While Mr Morton said the group needs to make more in terms of its financial performance, he said the increased turnover was “very pleasing”.
