Alliance Trust’s savings business has delivered its first annual profit for eight years after the operation’s assets under management swelled by a third.
The Dundee-based firm is now planning to invest about £2 million in Alliance Trust Savings (ATS) in a move aimed at bringing in more business from financial advisers.
The trust, which revealed it was setting up registered companies in England to “remove any uncertainty” over the outcome of September’s independence vote, has signed a deal with GBST, an Australian technology firm that has previously worked with Aegon UK to create an online savings platform for the Edinburgh-based insurer.
Chief executive Katherine Garrett-Cox said ATS, which racked up £400,000 of losses in 2012, delivered an operating profit of £400,000 last year. The business has about 60,000 customers and manages £5.4 billion.
Alliance Trust Investments, the firm’s fund management business, looks after £2.2bn while the trust itself has gross assets of £3.2bn.
Garrett-Cox said: “Markets are never easy to predict or indeed navigate through, but I think the fair ship Alliance Trust has sailed these waters very well.”
Total shareholder returns grew almost 23 per cent last year and the full-year dividend – including a special payout – rose 12.5 per cent to 10.83p.
The firm employs about 260 staff, 200 in Dundee, with the rest split between Edinburgh and London.
Garrett-Cox, said the trust had benefited from its large exposure to the US and had turned in a “very credible performance against a backdrop of challenging equity markets”.
Although the US Federal Reserve is “tapering” the cash it pumps into the economy, Alliance Trust believes it will take some time before the taps are shut off entirely. “There is a consensus view that tapering will be done by next October, but we think the Fed will be much more measured, particularly as we’ve seen the economic stats knocked out in recent months by weather-related challenges.”