Investec has pulled the plug on its robo-advisory service, recording a £12.8 million operating loss on the business after attracting fewer investors than expected.
In its annual results presentation, the Anglo-South African bank recorded a second successive year of losses on its Click & Invest operation, having reported a £13.5 million hits to profits in the year ending March 2018. In addition a circa £6 million write-off of capitalised software was taken in the current year, bringing total losses to about £32 million.
In a statement, the company says: "Investec Click & Invest launched just under two years ago, and we are extremely proud of the service we have provided and the consistently positive feedback we have received from clients.
"However, the reality has been that the appetite for investment services such as ours remains low and the market itself is growing at a much slower rate than expected."
Investec says it intends to use the technology developed under the Click & Invest banner in other parts of the group. Prospects for the unit's 54 staff are less certain and are currently under review.
The firm's withdrawal from the robo-advisory market follows ABN Amro's decision in April to shut down its online wealth management business, Prospery, in Germany after failing to attract sufficient clients. UBS also shuttered its SmartWealth robo-service last year, dampening prospects for the much-hyped automated wealth management sector.