Net flows continued to improve for wealth manager Brooks Macdonald in the second quarter which ended on 31 December.

Annualised net flows were 4.7% for the quarter.

This compares with a rise of 3.1% in the first quarter and a drop of 2% for the financial year ending 30 June 2021.

Total group funds under management as at 31 December were £17.3bn, an increase of 3.1% over the quarter (30 September 2021: £16.8bn).

Net flows for the discretionary business were £0.2bn, a 1.7% rise (6.8% rise annualised) with both BPS and MPS seeing positive flows.

The funds business continued to see outflows, but according to the trade update from the wealth manager outflows were declining. The Defensive Capital Fund was flat on organic flows.

The international business saw progress with a return to positive net flows.

Investment performance remained positive, although it was behind the benchmark index for the quarter. However, Brooks Macdonald said that despite lagging behind the benchmark, the wealth manager was confident that client portfolios are well positioned for the medium and longer term.

Andrew Shepherd, CEO of Brooks Macdonald, said: “We have a growing pipeline of new business, our highly talented people are continuing to work hard to improve and develop our service to clients and intermediaries, and we are in a strong position to take advantage of the great opportunities ahead for Brooks Macdonald."

According to the trading update, the wealth manager continues to make progress in its digital transformation, launching the planned new digital client onboarding solution in the second quarter. It said the transition of all client and intermediary-facing process to the new platform is ongoing and will conclude once testing has been completed.

The wealth manager will issue its preliminary statement of half year results for the period ended 31 December 2021, on 10 March.