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Perpetual AUM bolstered by Pendal takeover, equities rebound

By Charbel Kadib
4 minute read

The group’s new-look business has been buoyed by the acquisition of Pendal Group and the early-year recovery across equities markets. 

Perpetual Limited has released its results for the third quarter of the 2023 financial year (3Q23), the first trading update to incorporate the results of Pendal Group — formally acquired by Perpetual earlier this year.

The acquisition has added $110 billion to Perpetual Asset Management’s (PAM) total assets under management (AUM), which ended 3Q22 at $210.4 billion — up 114 per cent from the previous corresponding period.

The boost was largely driven by an increase in the combined equities portfolio, which grew from $77.8 billion in 3Q22 to $166.5 billion.


However, when excluding funds absorbed from Pendal, PAM’s combined AUM grew just 4.3 per cent from $97.9 billion as at 31 March 2022 to $100.2 billion.

When compared to the previous quarter, total AUM grew 6.9 per cent from $93.7 billion to $100.2 billion.

A $6.5 billion boost from market movements and foreign exchange impacts was slightly offset by approximately $100 million in net outflows.

Asset breakdown over 3Q23

The largest contributor to AUM growth over the three months to 31 March 2023 (including Pendal funds) was the boost to Perpetual’s equities portfolio, up 121 per cent from $75.2 billion.

Australian equities ($29.4 billion) make up just 17.6 per cent of total AUM, with global/international equities ($69.4 billion) representing the bulk of the equities portfolio at 41.6 per cent.

Perpetual’s fixed income portfolio increased 56.1 per cent, from $13.9 billion to $21.7 billion over the quarter, with the majority of investments in the Australian market ($11.5 billion).  

Other investments (including the multi-asset portfolio) totalled $10.6 billion — just 5 per cent of Perpetual’s total FUM.

Perpetual Wealth Management buoyed by market rebound

Perpetual Wealth Management reported 3 per cent growth (approximately $500 million) in total funds under advice (FUA) over the three months to 31 March 2023. 

Total FUA increased from $17.9 billion as at the close of the 2022 calendar year to $18.4 billion.

The improvement was underpinned by approximately $400 million in positive market movements, supported by net inflows of approximately $100 million.

Total average FUA also grew, rising from $17.9 billion in the second quarter of the 2023 financial year to $18.3 billion.

According to Perpetual, the overall improvement was helped by “continued contributions” from Jacaranda, Native Title, and philanthropy sector clients.

Perpetual Corporate Trust on the up

Perpetual Corporate Trust’s total funds under administration also reported a strong result for 3Q23, rising to $1.16 trillion as at 31 March 2023.

This represented a 10.4 per cent increase when compared to the previous corresponding period ($1.05 trillion) and a 1 per cent increase on the previous quarter.

The improvement was offset by a decline in funds under administration across the Debt Market Services (DMS) division, down 0.2 per cent ($1.6 billion) compared to the previous quarter.

Reflecting on the group’s overall performance over 3Q22, Perpetual chief executive officer Rob Adams welcomed the balance sheet improvement provided by the acquisition of Pendal Group.   

“As we bring Perpetual and Pendal’s asset management businesses together, it has been pleasing to see the strength of our relationships combined with a generally strong relative investment performance profile, leading to an improved net flow profile for the new group,” he said.

Perpetual has commenced a two-year integration program to deliver synergy benefits across the merged businesses.

Coinciding with the release of its 3Q23 trading update was an announcement of $20 million in additional synergy benefits — from $60 million to $80 million — that can be realised over the two-year integration time horizon.

To drive this, Perpetual has flagged a further $30 million in one-off implementation costs.

Looking ahead, Mr Adams said he expects the macroeconomic environment and general market conditions to “remain challenging”.

“This will impact each of our asset management boutiques differently, given the variety of investment approaches we now have across the group,” he added.

“Whilst we are only three months post the acquisition of Pendal, we expect the benefits of bringing these businesses together will help better navigate the current environment.” 

Perpetual AUM bolstered by Pendal takeover, equities rebound

The group’s new-look business has been buoyed by the acquisition of Pendal Group and the early-year recovery across equities markets. 

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