In brief
Rathbones Group Plc (“Rathbones”) announces a trading update for the three months ended 30 September 2026.
- Strong financial performance and strategic momentum
- Funds under management and administration up 7.2% and nine-month operating income up 6.7% year on year
- Wealth Management delivers second consecutive quarter of net inflows
Jonathan Sorrell, Group Chief Executive, said:
“In the third quarter, we continued to deliver progress against our strategy. We generated net inflows in Wealth Management for a second consecutive quarter, strong investment performance for our Wealth Management clients and hit operational milestones that position us for growth.
Our ambition is to be the best wealth manager in the UK, by far, and the growth opportunity ahead of Rathbones is substantial. We are broadening how we help clients with the launch of on-demand Financial Planning, and have received regulatory authorisation for Rathbones Ireland, which means we can fully service existing and new clients in Ireland and in the EU. We have also launched our first brand campaign, highlighting our purpose to help more people invest well so they can live well.
Our regulatory programme is on track. We expect to start progressively lifting restrictions relating to existing Enhanced Due Diligence clients in Q4.
With flows improving and our strategic initiatives making good progress, we are encouraged by the momentum in our business.”
Open the full results statement (PDF)
Financial highlights
- Total operating income was £243.6 million for the quarter, up 3.0% year on year, and £731.1 million for the first nine months, up 6.7%, reflecting the strength of our business model.
- Funds under management and administration (FUMA) increased 7.2% year on year to £121.1 billion at 30 September 2026 (30 June 2026: £120.7 billion, 30 September 2025: £113.0 billion), of which £112.9 billion is in our Wealth Management business. This increase was supported by positive market and investment performance.
- Wealth Management attracted net inflows of £24 million in Q3 (Q3 2025: net outflows of £0.3 billion), the second consecutive quarter of net inflows and a marked improvement vs Q3 2025. This is despite the voluntary pause on inflows from Enhanced Due Diligence (EDD) clients and a cautious backdrop ahead of the UK Autumn Budget. Net flows remained positive for the first nine months of the year at £11 million, compared to net outflows of £0.8 billion in the first nine months of 2025. Excluding lower-margin, execution-only services, Wealth Management recorded positive net inflows of £0.3 billion year to date.
- Asset Management saw net outflows of £425 million in Q3, reflecting continued pressure on active equity investment in the UK retail market, bringing Group net outflows to £401 million in Q3.
- Rathbones issued £60 million of tier 2 capital in September to further improve the efficiency of the Group’s capital structure, redeeming the £40 million of tier 2 notes issued in 2021.
Strategic and operational highlights
- Clients continue to benefit from strong investment outcomes, with Wealth Management client portfolios outperforming ARC1 benchmarks over the quarter, year to date, and over one- and three-year periods.
- Rathbones launched its on-demand advice service, providing clients access to Financial Planning when they need it at key points in their lives, without requiring them to commit to an ongoing service.
- Rathbones Ireland received a MiFID licence from the Central Bank of Ireland, enabling the Group to fully service new and existing clients in Ireland and the European Union.
- Rathbones launched its first brand campaign ‘Invest well. Live well.’ in September, increasing awareness of Rathbones and supporting our long-term growth ambitions.
Regulatory programme on track
The regulatory programme announced in June continues to progress on schedule, and targeted client reviews have started. There have been no material client outflows attributable to the programme, the impact on new business activity has been contained, and colleague attrition remains in line with normal experience.
The new Customer Risk Rating framework is in place. We have completed our file review pilot, applying the framework to a sample of restricted EDD clients, and the results indicate a material reduction in the number of clients classified as requiring EDD.
We expect to begin progressively lifting restrictions for existing EDD clients in Q4. By the end of the year we expect to have reviewed restricted EDD clients representing approximately two thirds of affected FUMA with the remainder completed by early Q2 2027. At the point clients are assessed as no longer requiring EDD, they will be released from restrictions on inflows; clients still requiring EDD will be released as they are remediated.
We have made good progress on the wider programme to address the findings of the Skilled Person review and expect to provide further guidance in February when we announce our preliminary results for 2026 on the likely timing of removing the restriction on accepting new EDD clients.
Our estimate of the cost of this programme through to mid-2028 remains unchanged at approximately £60 million net of expected insurance recoveries.
Update on Vision
Separately, our wholly owned subsidiary Vision Independent Financial Planning Limited (“Vision”) has received a requirement notice from the FCA under section 166. We expect the costs associated with this regulatory review to be approximately £2.5 million and have provided for this accordingly.
Following a reduction in the number of adviser firms on the Vision network during the course of this year, we expect the run-rate pre-tax profitability of the Group in respect of Vision to reduce by approximately £4.0 million from 2027 onwards. Vision remains committed to continuous improvement in its client service, systems and compliance processes.
Rathbone Investment Management Limited (“RIM”) continues to manage £1.9 billion of FUMA for clients of adviser firms that have left the Vision network in 2026. An adviser firm leaving the network does not in itself change the relationship between RIM, the adviser firm and the clients.
Outlook and Q4 trading update
With the planned Q4 2026 implementation of Salesforce, bringing client lifecycle and relationship management together on a single platform, and ongoing cost efficiencies being achieved, we continue to expect to meet our underlying operating margin target of 28.7% in Q4, subject to the conditions set out on 27 February regarding FUMA growth, inflation, and interest rates. The margin progression this will represent for the year leaves us in a strong position as we look forward to 2027.