The chief executive of Brooks Macdonald International, Andrew Shepherd, has told International Adviser that the company has “exciting plans” for all of its distribution channels across the fiduciary market, private client team and in its work with financial advisers.
His comments come after IA reported, on 12 September, that Brooks’ international division had outflows of £160m ($199m, €180m) for the year ending 30 June 2019.
“International is an important part of the group, complementary to our other two businesses,” said Shepherd who highlighted his own promotion from group deputy chief executive to chief executive of international as “symbolic of the group’s commitment” to the division.
Shepherd has plans to “reinvigorate the business”, but is aware that it will not happen overnight.
“While we recognise FY20 will be, to some extent, a year of rebuilding; international plans to return to material new business growth in FY21, achieving levels of growth and profit margins in line with UK investment management.”
The UK discretionary investment management business saw a 5.1% rise in inflows, taking its assets under management to £9.95bn, while net new business increased by 5.4%.
Possibility of acquisitions
During Brooks’ full year results, group chief executive Caroline Connellan said its “strong foundations” have allowed the group “to start looking at potential high-quality acquisitions”.
IA asked whether this meant that the international arm was possibly looking at buying businesses.
Shepherd added: “We have a high bar for any acquisitions in terms of strategic logic, quality of the acquired business, and return on investment but – subject to those criteria – the international business is certainly not excluded.”
Bolstering funds under management
In its results, the international arm reported a 5.2% drop in funds under management to £1.6bn for FY19, which the company attributed to “client attrition following the previously disclosed loss of a client-facing team in summer 2018”.
IA asked the firm how it intends to improve the funds under management for the international arm.
“We see material opportunities for international across all three distribution channels – fiduciary, private clients and advisers,” said Shepherd.
“In parallel with a range of business development activities, we are undertaking a proposition review to ensure our client offering is appropriate for each channel.
“We will also make material marketing investment in support of the new strategy.
“We are happy to look at opportunities for hires but are very comfortable with the high-quality team we have in place.”
