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Old Mutual Ltd on Tuesday said assets under management declined amid a challenging economic climate and market volatility.
The Anglo-South African financial services firm said gross flows dropped by 7.2% to R 136.13 billion for nine months to September 30 from R 146.63 billion in the prior year.
For nine months, funds under management were lower at R 1.19 trillion, down 6.3% from R 1.27 trillion.
But gross written premiums rose by 12% to R 16.86 billion from R 15.10 billion, on the back of higher renewal rates and new business sales in Old Mutual Africa Regions, particularly in Kenya’s medical business, coupled with good premium growth in the Specialty division of Old Mutual Insure.
Life annualised premium equivalent sales were up 17% to R 9.49 billion from R 8.13 billion, benefiting from strong issued sales across all channels and improved credit life sales in Mass and Foundation Cluster.
Sales growth was also driven by higher group risk and annuity sales in Old Mutual Corporate, as well as higher retail and corporate sales in Namibia.
Net client cash flow more than halved to R 1.16 billion, down 56% from R 2.62 billion due to reduced mortality claims across the life businesses and lower client disinvestments and terminations.
Despite tough economic conditions, sales recovery has maintained momentum in the third quarter across life businesses, Old Mutual said.
‘The difficult global macro-economic conditions have impacted the operating environment in South Africa and the other countries in which we operate. South Africa has experienced rising inflation, interest rate increases and ongoing loadshedding. In the African markets where we operate, the economic climate continues to be volatile due to escalating inflation rates and depreciating currencies,’ the group said.
Looking ahead, Old Mutual said it continued to be concerned about the impact that the current economic environment was having on policyholders’ ability to maintain their policies.
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