LGIM’s profits up in a “challenging” market

Profits upLegal & General Investment Management (LGIM) profits were up 3% to £366 million (€422.7 million) last year, despite seeing lower fund inflows.

Total assets under management (AUM) increased by 45% to £177.4 billion, which LGIM attributed to positive flows, rallying equity markets and the devaluation of sterling.

US business delivered a particularly strong performance, said LGIM, with inflows reaching £9.4 billion, up from £6.3 billion in 2015.

The firm said it was well positioned to benefit from the growth of the UK defined contribution market.  LGIM enjoyed inflows of £2 billion into its workplace platform although this was down by almost a billion on its 2015 figure (£2.9 billion).

LGIM’s active funds delivered “consistent strong performance” with the majority beating their benchmarks over the past one, three and five years according to the firm. Flows into the firm’s active offering were positive at £29.2 billion, again down on the 2015 figure of £37.7 billion.

One area that LGIM emerged relatively unscathed was in its real assets division. Unlike many firms who had to close their property funds after the EU referendum, LGIM’s remained open but were still “adversely” impacted.  But inflows resumed in the final quarter of 2016 and contributed to an overall AUM of £19.6 billion, up from £18.3 billion in 2015.

“We have delivered robust results in a challenging environment and continue to successfully expand our business,” said Mark Zinkula, CEO.

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