If annual income of more than £100 million provides the differentiator between “large” firms and the rest of the independent constituents of the UK’s wealth management sector the equivalent metric as far as assets under management and administration are concerned would appear to be £20 billion.
Perhaps not surprisingly, given that most wealth management firms’ income is derived from client asset-based fee and commission income all nine firms that fall within this subset in terms of income generation also feature a ranking based on this metric.
Nonetheless there is not a perfect correlation between income and assets under management and generation.
Schroders, whose wealth management interests trade as Cazenove and Benchmark Capital, heads a ranking in terms of assets under management and administration despite trailing both Rathbones and Brewin Dolphin in terms of income at the end of the latest full-year reporting cycle.
It had £57.2 billion of assets under management and administration at 31 December 2017 compared to the £40.1 billion of assets under management reported by Brewin Dolphin at 30 September 2017 and the £39.1 billion reported by Rathbones for the year to 31 December 2017.
Schroders’ lead over Brewin Dolphin and Rathbones may reflect the impact of Benchmark Capital, in addition to the progress being achieved at Cazenove Capital, its best known brand. Benchmark Capital is a West Sussex-based firm in which Schroders owns a majority interest and is active in a number of wealth management segments.
Investec Wealth and Investment Limited, which encapsulates Investec’s UK wealth management operations, has yet to post its latest full-year accounts at Companies House.
Based on the full year results of its parent, however, the firm will almost certainly occupy fourth position with client assets under management of around £35 billion based on the £36.9 billion of client assets Investec Wealth and Investment reported for its non-South African-based activities for the year to 31 March 2018.
Smith & Williamson is the next biggest wealth management firm in terms of client assets. Its investment management and banking arm reported £20.1 billion of client assets for the year to 30 April 2018. In addition the group reported another £11.8 billion of assets under administration to bring total client assets to £31.9 billion.
Tilney, Canaccord Genuity, Quilter Cheviot and Charles Stanley, the other four “top” firms cluster around the £23 billion to £25 billion mark.
Canaccord Genuity reported client assets of £24.8 billion for the year to 31 March 2018; Tilney £24.1 billion; Quilter Cheviot £23.48 billion for the year to 31 December 2017; and Charles Stanley £23.8 billion for the year to 31 March 2018.
Once again the caveats mentioned in respect to the ranking by income published on 11 July apply.