UK cements its position as global asset management hub

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The IA’s first annual Asset Management Survey following the UK’s decision to leave the EU reveals assets under management in the UK increased by 20 per cent in 2016 to a record £6.9 trillion (£5.7trn in 2015). 

On average, assets under management have grown by 8 per cent per year in the last 10 years. The exceptional growth witnessed in 2016 largely reflects an increase in the value of overseas assets, which benefited from the weakening of sterling versus all other major currencies following the Brexit referendum in June. 

£2.6 trillion is managed in the UK on behalf of overseas investors (£2.2 trillion in 2015). Over 50 per cent of this is managed for non-UK European clients (£1.4 trillion) further cementing the UK’s position as the largest asset management centre in Europe and the second biggest global asset management centre after the US. 

Now in its 15^th year, the survey shows the UK asset management industry is 373 per cent the size of the UK’s GDP. At almost 4 times the size of the UK economy, the significance of asset management to the UK is clear when compared to other European countries, where the average value of assets under management is close to 100 per cent of local GDP.  

The importance of the industry to the UK economy is illustrated though the investment they direct towards UK companies, property and infrastructure, the impact they have on the wealth of individuals as they manage their pensions and investments, and the earnings asset managers bring to the UK from overseas clients. 

Chris Cummings, IA CEO, comments:

“The asset management industry has again experienced a year of strong growth confirming the UK’s place at the forefront of a competitive global market. As an industry, we are responsible for looking after the pensions and investments for millions of savers.  We act as the stewards of the UK economy and we  work hard to ensure good corporate governance. We recognise the responsibility we carry and the trust invested in us by the investing public. 

Our members help finance UK companies to power the wheels of innovation and increase productivity. As investors, we take an on-going interest in the long term strategic health of the businesses we invest in and hold the management of those firms to account. This year’s report also sees an increasing focus on infrastructure investment, supporting the delivery of essential social housing, healthcare and environmental projects at the heart of communities right across the UK.” 

The UK’s investment management industry plays a vital role in supporting the economy, through job creation & employment and investment in businesses and infrastructure.