New research on the UK wealth management sector has revealed that assets under management have reached a record £957bn for the first time with collective investments now making up over 40% of all assets.

Highlights of the report by Compeer, a business performance benchmarking firm, found:

•2017 saw a 13% increase in AUM, with the biggest growth in discretionary services

•Wealth managers achieved £104bn of asset inflows in 2017

•Expenditure significantly increased in IT and operations, rising by £76m in the last year to £1.17bn 

The UK Wealth Management Industry Report covered 176 firms, all with a minimum £50m of investment assets.

The findings showed that growth in 2017 saw the biggest rise in discretionary services, rising by £64bn.

Other key drivers for growth were tax wrapped products such as ISAs and SIPPs, with asset values for these types of accounts almost doubling since 2013.

Revenues increased 7% year on year to a new high of £6.78 billion, driven by significant rises in management fee income.

A record was also set by wealth managers, achieving £104bn of asset inflows, with collective-based investments now representing 40.7% of all assets.

James Brown, head of client services at Compeer said: “This move towards collective-based investments suggests further caution in investment decisions, which is to be expected in light of the uncertainty surrounding Brexit negotiations.

“However, the latest report shows that the wealth management industry is continuing to grow and deliver record profits. This is fundamental to the UK industry as it seeks to strengthen its global relationships with emerging markets in a post-Brexit world.”

The annual benchmarking survey by Compeer tracks 176 firms including execution-only stockbrokers, full service wealth managers, investment managers and private banks.