Old Mutual, the international insurance group, has reported a 17 per cent year-over-year fall in adjusted operating profit in its wealth management division, from £115 million ($180 million) for the first half of 2011 to £95 million for the same period this year.

In the first half six months of 2011, Old Mutual benefited from policyholder tax smoothing of £16 million. Without that, the profit decreased by 4 per cent in the first six months of 2012 compared to 2011. The firm said that the fall reflected lower funds under management fees.

The wealth management arm logged funds under management of £65.5 billion at the end of June, up by 12 per cent from £58.6 billion a year earlier.

Across its divisions, Old Mutual made a adjusted operating profit before tax of £791 million in the six months ended 30 June 2012, up from £709 million last year. The group's total funds under management fell from £264.7 billion at the end of June 2011 to £260.7 billion.

Julian Roberts, group chief executive, also highlighted the merger of Skandia Investment Group and Old Mutual Asset Management UK, which has created an asset management platform the group will use to develop a wider range of solutions for clients.

"We are currently in discussions with a limited number of high-quality asset managers to develop a range of fund solutions that we believe will meet the majority of the needs of our customers and IFAs, post-RDR [the Retail Distribution Review]," Roberts said. "We believe that this will drive revenue growth in wealth management over time."

The group has also released its UK platform pricing ahead of the introduction of the RDR, which comes into force on 1 January 2013.