The Edinburgh-based asset manager and pension and savings operator on Tuesday posted an 18% rise in overall pre-tax operating profit to £341m ($442.5m, €399m) for the six months to 30 June. Within this, the UK pensions and savings business, which includes the Wrap platform, grew 7% to £151m.
Standard Life said total offshore bond assets under administration (AUA) on the platform rose to £2.2bn ($2.9bn, €2.6bn) in the first half of 2016, compared with £2.1bn at 31 December 2015.
Total AUA for international bonds stood at £5.0bn at the end of June, up from £4.8bn at 31 December 2015.
The company also said it expected to complete its recent acquisition of the Elevate platform it bought from Axa in May in the second half of this year for a total cost of around £100m, including the price paid and the integration costs.
India focus
In line with its geographical diversification strategy, Standard Life has also announced that HDFC Life, its Indian insurance joint venture company with HDFC Bank, has agreed merger terms with Max Life Insurance to combine their life insurance businesses
On completion of the deal the newly-merged company would overtake ICICI Prudential to become India’s largest private insurance company.
Standard Life had increased its stake in HDFC Life to 35% from 26% in August last year and, following the merger with Max Life, it will end up with the 24% of the new company. It also owns a 40% stake in HDFC Asset Management Co, a leading Indian asset management business.
“We will have strategic stakes in the leading life insurance and asset management companies in India, one of the fast growing economies in the world,” said Keith Skeoch, chief executive of Standard Life.
“We’ve thought for some time that, with its growing population, increased rise of the middle class and increased rise of consumption in India, this is a very attractive place to be for the long term,” he said.
“We want to make sure we are strategically exposed to what will be, over the next 10 years, one of the fastest growing economies in the world.
“In India, if you look at HDFC Asset Management, what they sell is Indian mutual funds to Indian investors. At some point [Indian investors] will want to diversify, they will want to buy global funds that are exposed to the benefits that come from the rest of the world. And our intention is to make sure those global funds sold in India are manufactured by Standard Life,” he said.
Meanwhile in Asia, changes to the regulation in Hong Kong last year is still acting as a drag on Standard Life’s business there after it stopped writing recurring premium business.
However, Skeoch said that in terms of the other activities in the tegion business had picked up “It has gone from £15m from our share of associates and joint ventures last year to £21m this year. And that is coming out of our Indian operations,” he said.
Skeoch said that as part of its diversification agenda, Standard Life has recently signed a partnership agreement with Bosera Asset Management (International) Co, a leading Chinese asset manager, to distribute some of its investment funds within China.
“That’s a very exciting development for us,” he said.
The company also has a Chinese joint venture company called Heng An Standard Life Insurance Co, which is a 50:50 partnership with Tianjin Economic Technological Development Area (TEDA) created in 2004.
“Heng An Standard Life is a business which is relatively small but it has a very, very substantial customer base and we continue to see improving momentum,” he said.
