Standard Life Aberdeen PLC (LON:SLA) has appointed Keith Skeoch as its sole chief executive ending a contentious period when the company was run jointly by Skeoch and Martin Gilbert, who led Aberdeen Asset Management at the time of its merger with Standard Life in 2017.
The FTSE 100-listed company said Gilbert will continue to serve as vice chairman of the group and chairman of Aberdeen Standard Investments, and focus on building relationships with key clients, winning new business and "realising the potential from our global network and product capabilities”.
READ: RBC Capital fears for Standard Life Aberdeen dividend after ‘cut-price’ sale of life insurance business
The investment group also said its finance director Bill Rattray would step down at the end of May, to be replaced as chief financial officer by Stephanie Bruce, a partner at consultant PwC.
Former HSBC boss Douglas Flint – who took over as SLA’s chairman on January 1 – said: "The new structure will strengthen our client focus, simplify reporting lines and facilitate robust execution of the next stages of our transition and transformation programmes."
The management change news came as SLA reported full-year results showing a profit from continuing operations in 2018 was broadly flat at £650mln, although net outflows from its funds rose to £40.9bn from £32.9bn.
The group left its final dividend unchanged giving a full-year payout of 21.6p, up from 21.3p in 2017 and said it intends to maintain the dividend per share at the 2018 level during the current period of transformation.
Keith Skeoch commented: "Our integration process is running ahead of schedule and is now roughly 75% complete even though we are less than halfway through the original timetable.”
in early morning trading, SLA shares were 3.4% higher at 253.25p.
“Institutional money accounts for three times more AUM than retail"
Nicholas Hyett, equity analyst at Hargreaves Lansdown commented: “Outflows from higher margin products mean revenues are still trickling away at SLA. Management seem to see that as an inevitable consequence of the transformation plan though – and are pointing investors in the direction of some fairly impressive cost savings and the strong performance of the retail platforms as better indicators of where the group’s headed.”
He added: “The company can’t afford to lose too much institutional money though, which probably explains why Martin Gilbert is being kept firmly within the fold despite stepping down as co-CEO. Gilbert built Aberdeen Asset Management on relationships with global institutions, and he remains key to maintaining those relationships and winning new business.
“Institutional money accounts for three times more AUM than retail, and while we think the retail opportunity is significant, the fundamental logic behind the Standard Life/Aberdeen merger rests on the group’s diverse customer and distribution network. That needs to be protected even as the group delivers some fairly sizeable cost savings.”
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