Rathbones expands despite the gloom

Jul 25 2008 by Alex Turner, Liverpool Daily Post

THE credit crunch is having little effect on fund managers Rathbone Brothers, which continues to grow its Liverpool-based operation, despite gloomy economic conditions.

The firm has increased staffing at its Port of Liverpool office by 20, to more than 300, as it provides support for the expanding business.

Rathbones has opened two new offices, in Birmingham and Exeter, with an Aberdeen office due to open later this year.

Andrew Morris, the director responsible for Rathbone’s investment management business in Liverpool, is delighted about the growth in the city.

“We provide an operational platform for the entire Rathbones business,” he said. “We have to continually invest in our operational support in Liverpool so the expansion is great for us.

“As a business, we continue to grow, but in a conservative way.”

The firm, which now has 11 UK offices, yesterday announced a 2.5% rise in first-half profits to £24m despite what it described as “very challenging” times.

Funds under management decreased 8.6% to £12bn in the six months to June 30. This compares favourably with the 12.9% fall in the FTSE-100 index in the same period and a 9.8% fall in the FTSE/APCIMS Balanced Index, regarded by Rathbones as the index which most closely reflects the spread of investments held by its private investor and trustee clients.

New business increased by 8.2% and Rathbones also benefited from providing liquidity to the market, especially as the inter-bank lending rate, Libor, has, been significantly higher than the base rate.

Its Liverpool office has funds under management of £1.5bn and is attracting significant new business to its charity division and its ethical investment arm, Greenbank, launched in May.

Mr Morris said: “It’s swings and roundabouts. We benefit from running high levels of liquidity for clients, but in less volatile times we might see a higher level of turnover in clients’ accounts, which generates greater returns from commissions.

“We face the medium and long-term future with guarded optimism.”

alex.turner