Advised platforms gross flows in Q2 remained strong but outflows continued to rise and net sales were down sharply by 12.28% to £2.88bn, new figures from consultancy the Lang Cat reveal today.

Competition from high cash savings rates and investors and savers paying down debt and having to meet rising living costs were the likely factors in the sales slump, the Lang Cat said.

Advised platform quarterly asset grew by 2.12%, with Quilter topping the advised gross sales and net sales tables.

Advised platform outflows were up 2.56% (£15.77bn) compared to Q1 2024 (£15.38bn), and 30.35% up year on year.

The Lang Cat said advised gross sales in Q2 2024 remained at a similar, “elevated level” to the strong numbers seen in the first quarter.

Total advised gross sales of £18.65bn (-0.06% vs. Q1 2024) were some of the highest quarterly sales numbers since record-breaking sales of 2021, the Scottish firm said.

Despite this, outflows from advised platforms continued to rise for an eighth consecutive quarter. Outflows were up 30.35% year on year (Q2 2023 £12.10bn). With gross sales flat and outflows rising, leaving leaves advised net sales at a “precarious” £2.88bn for the quarter, down 12.28% on the first quarter.

The firm says that for the first time since 2017, platform Quilter topped advised gross and net sales tables, owing to increased flow from its IFA community alongside its own advisers. Following Quilter in a close second for net sales was fellow FNZ-backed platform Aviva.

Across all platforms pensions continued to produce a significant majority of net sales though ISAs continue to struggle, with more business leaving ISAs than has come on for the last five quarters, and for seven of the last eight.       

Rich Mayor, senior analyst at the Lang Cat, said: “There’s a continuation of strong gross flows into platforms again this quarter. Our recent research with advisers suggests that most of the business they’ve written this year has been transfer business, and transfers are included in the gross sales numbers we get from platforms. Some advisers are quite active in this space, and a surprising amount have told us they’ve chosen a new primary or secondary platform in the last year.

“But aside from the strong gross sales numbers it’s not all good, with outflows from advised platforms rising for the eighth quarter in a row. Advisers are still telling us it’s for the same main reasons: paying off mortgages and other debt, helping family members, and increased competition from products that are better in a high-interest rate environment like cash and annuities.

“The question is whether we’ve reached the peak? A rate cut, and reduced inflation should pave the way for reduced outflows and improved net sales in future, particularly if interest rates continue to come down.”

Platform Sales and AUA in Q2 2024

 Source: The Lang Cat / Q2 2024 figures

• Fellow platform consultancy Fundscape reported today a similar picture and says its findings showed that rising stock markets helped business. Platform assets under administration rose to £1.1trn at the end of the Q2, up £47bn against Q1 and a substantial £136bn since the start of the year, providing a “welcome uptick” to platform revenues. Bella Caridade-Ferreira, CEO of Fundscape, said, “Steady as she goes is the best way to describe adviser platform activity as they battled competition from cash, annuities and the impact of higher living costs.”