Arbuthnot Latham says that a change in strategy in attracting new clients this year has resulted in around 40 clients joining the private bank every month.
In turn, this has driven positive net inflows of customer balances into Arbuthnot’s Investment Management business for the third quarter of 2019.
Arbuthnot did not disclose the details of the strategy but said in a statement to PBI: “The Private Bank will concentrate on sourcing and nurturing new relationships with criteria clients. Over time, this should increase the flow of customer balances into deposits, investment management and also provide wealth planning opportunities.”
However, it has not helped the private bank’s total assets under management. “Assets under management remain below our expectations, largely as a result of the poor stock market conditions at the end of 2018 and also the slow conversion rate of criteria clients in the first part of the year”, Arbuthnot Banking Group’s Third Quarter Trading Update stated.
The exact assets under management for the third quarter were not disclosed, but in its half year results, Arbuthnot said assets under management at the Group had decreased by 4% to £1,029m in the six months to 30 June 2019.
Wealth Planning loss
Losses were also recorded at Arbuthnot Latham’s Wealth Planning division in the third quarter of 2019.
This is due to a decision in July to cease charging clients for annual advice reviews and instead move towards an “event based model, where clients are charged wealth planning fees when they need specific advice”.
This model has so far not proved profitable and the Wealth Planning division has recorded a for Q3 2019 as a result.
Arbuthnot Latham is the private banking division of Arbuthnot Banking Group, which also owns Arbuthnot Commercial Banking and Renaissance Asset Finance.
Renaissance ended the quarter with lending balances of £101m, an increase of 22% compared to the prior year.