Wealth managers across the sector have gradually clocked on to the perks of regular fee income over commission revenue. For wealth manager Rathbones (RAT), which has long been a proponent of the discretionary management that others are moving towards, fee income represents an increasing proportion of operating income. Net fee income was up 12 per cent in the first half of the year at £87.1m. This was offset by lower net trading commissions, which were down by a quarter to £19.4m.
Costs associated with last year's acquisition of financial advisory company Vision weighed on pre-tax profit. However, the good news is that organic net inflows for the investment management business were £0.3bn, representing an annualised growth rate of 2.5 per cent. Against a backdrop of mass redemptions across the industry, the unit trust business also gained net inflows of £259m, taking funds under management there to £3.3bn.