UK wealth manager Rathbones seeks cost controls as volatile markets pose risks

Rathbones Seeks Cost Controls as Market Volatility Risks Rise

(Reuters) -British wealth manager Rathbones, on Thursday, reported net outflows and a fall in funds under management for the first quarter and said it would control costs to shield its profit from sustained market volatility.

WHY IT'S IMPORTANT

U.S. President Donald Trump's erratic tariff policies have caused significant volatility in global markets, and companies across sectors are taking steps to protect their business from rising uncertainty.

QUOTES

"Market volatility ... creates opportunities for asset managers, but sustained volatility can also impact revenue and profitability," Rathbones CEO Paul Stockton said in a statement.

"We will be looking to manage operational cost levels actively to mitigate these effects on profitability as much as possible," he said, without going into details.

CONTEXT

The company said wealth management fund valuations and fee income calculations were done at the end of the January-March quarter, which coincided with a moment of particular market weakness.

The markets had been on tenterhooks ahead of Trump's "Liberation Day" tariffs, which were announced in early April and, along with other sectoral tariffs since, have caused turmoil in the global markets.

BY THE NUMBERS

Rathbones reported a 4.7% decline in funds under management and administration to 104.1 billion pounds ($138.3 billion), in the quarter, while total net outflows were 784 million pounds.

Lower gross inflows and weak flows into equity, fixed interest and multi-asset funds had some impact, it said.

MARKET REACTION

"After the tariff-related correction, markets have since recovered, but we remain conscious that macro factors are likely to weigh for some time," Peel Hunt analysts said in a note. ($1 = 0.7528 pounds)

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Savio D'Souza)