Royal London boss commits to dumping Russian assets as pension giant reports profit boost
Royal London boss Barry O’Dwyer said the firm would dump its Russian investments as soon as possible today, as the pension giant reported rising sales and jump in profits for 2021.
O’Dwyer told City A.M that the firm’s holdings in Russia made up 0.1 per cent of its portfolio and it aimed to scrap them as soon as trading resumed in Moscow, after the exchange was shuttered this week amid market turbulence.
“Even before they had fallen in value they were less than 0.1 per cent of our assets, and it is all index funds where we were essentially forced to buy Russian firms because they were part of the index. We didn’t have any active positions even before this,” he told City A.M.
“Markets are suspended now but we will sell them as soon as we can, and we have no further plans to invest in Russia.”
His comments came as the group posted a jump in pre tax profits to £192m last year, up from £131m in 2020.
New business sales in its pensions division surged 12 per cent to £7.96bn as the firm felt a lift in demand for its workplace pensions offering.
O’Dwyer said it had been a strong year for the firm.
“Sales and profits are both up on last year. We have maintained very strong flows into our asset management business, helping assets to hit record levels. Our Governed Range remains a hugely popular choice amongst independent financial advisers and this range alone accounts for over £50bn of our customers’ investments,” he said.
Royal London said it had doubled down on its ESG commitment in the past year and transitioned £23bn of indexed equities into its governed range to improve their carbon intensity.
“This has been a real successful story for us in the past few years,” O’Dwyer told City A.M. “These have continued to sell in 2021 and are a big part of the flow into our asset manager.”
He warned that market volatility made it hard to anticipate trends among investors in the year ahead but expected demand for ESG funds to continue to grow.
Royal London customers are set to revel in £169m worth of payouts, up from £146m in 2020, as part of its mutual status ProfitShare scheme.
The firm is now exploring a roll out into new European markets in the year ahead.