ANNUAL REPORT AND FINANCIAL STATEMENTS 2012 | 09


Implementing the appropriate cost base for each core investment capability


Create greater flexibility in our cost base


2012 key points • Core operating costs reduced by £23.3 million, as analysed on page 119


• The cost reduction/realignment programme remains on target to deliver £48.8 million of annualised cost savings


• Completed the reorganisation of Operations, Fund Services and IT functions to oversee the outsourced operations model


• Consolidated and successfully migrated all mutual fund platform and investment trust fund administration services to State Street from a number of service providers


• Transitioned over 180,000 individual savings accounts from BNP Paribas to International Financial Data Services (IFDS) without interruption to client service


• Group headcount reduced by 124 employees, on a full-time equivalent basis


• Appointed new Co-Heads of Investment


Key performance indicators Underlying operating margin %


29.2 2012 24.4 2011 28.5 2010


Improving capital strength


2012 key points • Repurchases totalling £16.7 million of the Company’s debt during the year


Developing a direct to consumer capability


2012 key points • Head of Direct-to-Consumer marketing hired


• Further development of consumer strategy to take place in the first six months of 2013


Rationalising/prioritising the product range to better utilise resources


Focus on revenue growth and specialist areas for new business


2012 key points • Key institutional products include emerging market debt, equity-linked bond funds, liability driven investments and real estate


• In the UK retail market key focus remains Multi-manager and the ‘Lifestyle’ funds


• In the wholesale division key products include global bonds and global convertibles


• Appointed a new Head of Client Management


Key performance indicators Average basis points earned on assets under management*


23.9 2012 24.4 2011 22.6 2010 21.8 2009 22.9 2008


*excluding performance fees


Performance fees earned £m


9.5 2012 11.8 2011 12.9 2010 18.7 2009 7.9 2008


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