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Standard Life Aberdeen to post interim results after settling row with Lloyds

The day ahead includes half-year numbers from Standard LIfe Aberdeen and Legal & General

Standard Life Aberdeen PLC -
Hargreaves Lansdown thinks SLA's retail platforms will be the key driver of the company's results

Standard Life Aberdeen PLC (LON:SLA) reports its first-half results on Wednesday, hot on the heels of settling a dispute with Lloyds Banking Group PLC (LON:LLOY) over a contract to manage £100bn worth of assets.

Lloyds has agreed to pay SLA a £140mln settlement after severing the fund manager’s contract to run its Scottish Widows portfolio following the merger of Standard Life and Aberdeen.

SLA will continue to manage about £35bn of the assets until at least April 2022 while the rest of the assets will be transferred to BlackRock and Schroders.

“Unfortunately Lloyds isn’t the only investor that’s been looking to pull assets from SLA funds in recent years,” said Hargreaves Lansdown equity analyst Nicholas Hyett.

“While strong market performances have kept total assets under management growing, it’s crucial the company stops the rot. Markets don’t rise forever.”

At the end of March, SLA had assets under management and administration of £568.9bn, up 3% from the end of December.

A joint venture agreed with Virgin Money in January added £3.5bn of assets while the acquisition of Asia-based real estate manager, Orion Partners, added £700mln.

In the second quarter, Hargreaves’ Hyett thinks positive news is likely to be driven by the group’s retail platforms, which have continued to see assets grow, and new partnerships with Virgin Money and Phoenix.

Phoenix bought SLA’s insurance arm business for £3bn last year. As part of the deal SLA received a near-20% stake in Phoenix.

Investors look for further growth from L&G 

Legal & General Group PLC (LON:LGEN) is to publish its half-year numbers in the wake of winning the largest bulk annuity deal to date in the UK from Rolls-Royce Holdings PLC (LON:LGEN).

The group announced in June that Rolls-Royce has transferred £4.6bn of assets and liabilities, which relates to 33,000 pensioners.

Legal & General has now made four of the UK’s five largest pension risk transfer deals.

Last year the company become the UK’s first £1trn investment manager in 2018, having executed a record £9bn of pension risk transfer deals.

Investors will be hoping to see the company was able to continue to grow assets in the first half despite market volatility.

 

Major announcements due:

Interims: Glencore PLC (LON:GLEN), Hill & Smith PLC (LON:HILS), Legal & General PLC (LON:LGEN), Morgan Sindall Group PLC (LON:MGNS), Phoenix Group Holdings PLC (LON:PHNX), Spirax-Sarco PLC (LON:SPX), Standard Life Aberdeen PLC (LON:SPX), Ultra Electronics PLC (LON:ULE)

Economic data: Halifax house price index, US consumer credit

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