Sales slump at Old Mutual as turmoil reigns
THE chief executive of Old Mutual yesterday warned over the health of the banking sector as the group posted a 10 per cent drop in quarterly sales.
Anglo-South African Old Mutual recorded life insurance sales of £269m in the three months to March, beating the £262m expected.
“The banking world generally has still got a long way to go before stability comes through. So, there is no change, I think, in the position externally,” Julian Roberts said yesterday.
Old Mutual, which operates in 30 countries, suffered most in its wealth management arm, where sales fell 21 per cent to £153m, but its emerging markets business was up 10 per cent to £116m.
The group posted net client cash inflows of £3.7bn for the first three months, compared with outflows of £2.8bn in the 2011 period and better than the £1.1bn outflow expected by analysts.
The improvement was driven by its US funds arm, earmarked for an initial public offering, which turned outflows of £600m a year ago into an inflow of £2.6bn thanks to a better investment performance.
Core funds under management rose six per cent to £284.2bn.
Old Mutual still intends to offload its 52 per cent stake in Nedbank, South Africa’s fourth-largest lender, which would allow it to focus on insurance and asset management. A planned $8bn sale to HSBC fell through in 2010.
“Nedbank maintained the momentum it established last year by delivering positive margins, strong growth in non-interest revenue and continued reductions in credit losses,” Roberts added.