Investors withdrew £1.5 billion from M&G in the last six months, as the money manager said it is looking to cut costs across the business by £20 million more than before.
The group said the savings would come on top of an existing £200 million cost-cutting target, which includes a previously announced voluntary redundancy programme.
Part of the savings will come from a bid to simplify the company by merging its life insurance and wealth management operations into one business.
Chief executive Andrea Rossi said the group’s “simplification agenda continues at pace”.
He added: “Against the backdrop of a challenging market environment in the first half of the year, we have delivered another resilient financial performance with adjusted operating profit and capital generation nearly matching last year’s excellent results.”
The £1.5 billion in outflows – when investors withdraw more cash than they put in – represents a downturn from £700 million of inflows for the same period last year.
The withdrawals came from both the firm’s institutional asset management business and its wealth division.
However, it was less than analyst expectations of £2.8 billion, as withdrawals were offset by “positive markets”.
That market positivity helped M&G’s total assets under management rise slightly to £346.1 billion, up from £343.5 billion at the end of last year.
M&G was spun out of Prudential in 2019 and has been on an acquisition hunt in recent years, expanding into markets including wealth and digital advice.
In 2023, it rolled out a robo-advisory platform called &me, 12 months after taking a stake in tech provider Moneyfarm.
Mr Rossi continued: “Our simplification agenda continues at pace, delivering £121 million in cost savings so far.
“We have made considerable progress across all of our financial targets and, reflecting our track record of delivery and our commitment to strong shareholder outcomes, we are announcing today upgrades to our capital generation and cost savings targets.
“We are continuing to push further on our strategic priorities, combining our life and wealth operations to support the acceleration of our growth plan in the UK retail market.”