Funds management leapt from fourth- to second-highest revenue-generating unit for the NZX over the 12 months to the end of September, the latest quarterly update from the stock exchange reveals.
According to the NZX figures released last Friday, the funds management division – SuperLife and Smartshares – pulled in almost $13.9 million for the 12 months to September 30 compared to just over $10 million for the same period last year.
Annual income growth of close to 40 per cent pushed the NZX funds unit above issuer relationships (listing fees) and data services per revenue for both the 12-month and quarterly periods.
And with the addition of platform money contributed by Wealth Technologies, the funds-related businesses even rival the core NZX trading revenue – especially over the September quarter.
Combined funds ($4.9 million plus) and Wealth Technologies (over $1 million) income for the quarter compared to $6.8 million in NZX secondary markets revenue: for the 12 months to September 30, total funds/platform income amounted to almost $17 million against more than $21.1 million in NZX trading-related revenue.
Of the seven NZX business units, Wealth Technologies reported the highest relative growth-rate over both the quarter (up 92.5 per cent) and year (124 per cent) off a low base.
The platform business has added a few new clients this year – most recently the boutique wealth advisory Stuart Carlyon – boosting total funds under administration to almost $8 billion at the end of September – or a 142 per cent year-on-year increase.
In September Wealth Technologies also hired long-time Craigs Investment Partners head of client services, Stephen Jonas, as its inaugural chief operating officer. Craigs is the largest Wealth Technologies client.
The NZX has targeted funds under administration for Wealth Technologies of between $35 billion to $50 billion by the end of 2023.
Total funds under management (covering SuperLife and Smartshares) rose almost 32 per cent over the 12 months to September 30, according to the latest NZX figures, led by growth of over 42 per cent in the external exchange-traded funds business.
External clients now represent more than 40 per cent of the Smartshares $5.3 billion ETF assets under management: including non-ETF SuperLife holdings, total NZX FUM increased to almost $5.9 billion at the end of September.
In a letter to shareholders post the half-year results earlier this year, James Miller, NZX chair, said: “We see our Funds Management and NZX Wealth Technologies businesses as offering the potential for powerful synergies alongside our core market business.”