Royal commission headwinds buffeting fund management industry: Perpetual CEO

The bank inquiry’s early findings have impacted fund flows across the sector, notes new Perpetual chief Rob Adams at AGM.

Perpetual CEO Rob Adams. Picture: Supplied

The fund management industry has been hit by the royal commission into the financial services sector, new Perpetual chief executive Rob Adams has told the company’s investors.

“Our Perpetual Investments business was certainly impacted by some of those headwinds in the last year,” he said at the Perpetual (PPT) AGM this morning.

“Fund flows across the industry have been impacted by recent market volatility and through the early findings of the royal commission.”

At about 2pm (AEDT), shares in the company were trading 0.55 per cent lower at $34.46 against a flat index.

Mr Adams indicated that the company was open to inorganic growth, saying Perpetual would be looking to acquire new, high-quality, investment capabilities both in Australia and internationally.

“There is great scope to provide a broader suite of investment strategies to clients given our brand and the depth and breadth of our relationships, many of which have lasted decades,” he said.

It comes after the company booked a full-year net profit up 2 per cent to $140.2 million in the year through June, partly on a lift in outflows from institutional clients in the second half.

Mr Adams started in the top job six weeks ago after Geoff Lloyd left Perpetual in June after five years in the role to head up NAB’s wealth business MLC as it prepares to split from the bank.

“In a period when trust in financial services has declined, Perpetual’s brand has strengthened,” Mr Adams said.

“Perpetual has a true competitive advantage which I feel we can better leverage.

“I firmly believe our brand will present us with both organic and inorganic opportunities across each of our three businesses, and I intend to see Perpetual realising the benefit of these opportunities as they arise.”

Mr Adams vowed to drive shareholder value, after shares in the company fell more than 30 per cent since February.

“My team and I are deeply committed to doing all that is within our control to drive total return to our shareholders over time,” he said.

“With a renewed focus on delivering quality growth across all of our businesses as I have just described, I am confident we can achieve this.”