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Money Management

Standard Life Aberdeen wins dispute to keep managing £100 billion Lloyds mandate

Lloyds continues to discuss process to move assets to 2 new managers

Lloyds Banking Group and its subsidiary Scottish Widows are not able to terminate their 100 billion ($133 billion) investment mandate with Aberdeen Standard Investments, an arbitral tribunal ruled.

As a result of a merger between Standard Life and Aberdeen Asset Management in 2017, Lloyds and Scottish Widows sent notice on Feb. 14, 2018, to Standard Life Aberdeen seeking to terminate the arrangements.

However, according to the decision of the tribunal, Lloyds Banking Group was not entitled to give notice or to terminate the money management agreements in respect of assets managed by Standard Life Aberdeen.

Lloyds, after Aberdeen Asset Management merged with Standard Life, considered the firm a material competitor of Scottish Widows and Lloyds' wealth business.

Aberdeen said Tuesday it is carefully considering the terms of the decision and appropriate next steps. In the meantime, it will continue to manage the assets on behalf of Lloyd's customers.

"Now that the arbitration panel has ruled in our favor, we will carefully consider our next steps, working constructively with LBG to bring the matter to resolution," Keith Skeoch, CEO of Standard Life Aberdeen, said in a news release.

A spokesman for Scottish Widows said: "We are disappointed with the decision of the arbitration tribunal, and will look to discuss its outcome with Standard Life Aberdeen."

However, he said, "Our strategy remains unchanged, which is to do the right thing for customers. We will discuss starting the process of an orderly transfer of assets to our new partners BlackRock (BLK) Inc. (BLK) and Schroders PLC. We will continue to work closely with Standard Life Aberdeen to ensure there is no disruption to performance or service." The contract with Standard Life Aberdeen runs through March 2022.

The annual revenue associated with the assets was estimated at around 129 million.

Aberdeen Standard has 551.5 billion in assets under management.