Money manager Invesco yesterday said its acquisition of Morgan Stanley’s retail fund business bolstered third-quarter sales and aided a 47 per cent jump in profit.
Marking Invesco’s first full quarter since the acquisition closed in June, chief executive Martin Flanagan said integration of the unit with $115bn (£73bn) under management was nearly complete. The only significant task remaining is closing and merging some redundant funds in coming months, he said. “We’re seeing strong momentum of that combined business,” Flanagan said. “We’re still very, very early in what we expect.”
Average monthly sales to retail customers were up 40 per cent to $3.5bn in the four months since the deal closed compared with the first five months of the year, Flanagan said. The average withdrawal rate declined 12 percentage points, he added.
Still, total net inflow from retail investors was flat since the deal has closed, some analysts noted.
The bulk of the firm’s $4.9bn in net inflow during the third quarter came from lower-margin institutional investors. Atlanta-based Invesco said net income attributable to common shareholders was $154.7m, or 32 cents a share, up from $105.2m or 24 cents a share a year earlier.
Excluding acquisition costs, Invesco earned 39 cents a share, 4 cents above the forecast of analysts surveyed by Thomson Reuters.
City A.M. Reporter