James Moore: Standard Life’s star is purring like a Bugatti

 

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Outlook Standard Life might look like the corporate equivalent of a Ford Focus; solid, dependable, a bit boring. But under the hood lurks the engine of a Bugatti. Otherwise known as Standard Life Investments (SLI).

That engine is positively purring, hauling in £4.3bn during the third quarter despite the recent stock-market volatility (it should be said that the figures were flattered a bit by an acquisition). It’s all the more impressive given the mess life insurers have tended to make of fund-management businesses.

Life companies take in and administer vast swathes of money, and so they like the idea of having in-house managers to invest it for them. They also like the idea of having investment products among their offerings.

Unfortunately, they’ve tended to struggle with flashy fund managers and their demands for fancy offices with valet parking for their Bugattis. The latter have also chafed at taking orders from the actuaries at the top of the average insurer. Standard has bucked the trend by allowing SLI to operate on a semi-detached basis, in the same way that Prudential does with M&G. But Standard has built SLI into a star without over-paying for a big-ticket acquisition.

But for its happy situation to continue, SLI will continue to need an unusually strong individual at the top. It’s no exaggeration to suggest that finding the right successor for Keith Skeoch at SLI is now arguably more important than finding the right person to take over at the top of the group when David Nish is finally done.

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