Perpetual says media speculation wrong

Perpetual Ltd issued a statement yesterday saying a Dow Jones report that it had appointed advisers to assist with the sale of its corporate trust division is wrong.

The company said, at the release of its half-year results on February 23, that its priorities were a refinement of its growth strategy, the achievement of meaningful cost savings and a reinvigoration its of sales and distribution.

Speculation about the corporate trust division has arisen because it is a low margin business that performed poorly in the December half and faces a constrained business environment in the medium term.

A decline in the stock of residential mortgage-backed securities on issue combined with lower mortgage servicing volumes led to a 39 per cent per cent fall in the division's pre-tax profit.

The two parts of the division are trust and fund services and mortgage services. Trust and fund services' revenue was down seven per cent and mortgage services' revenue was down 30 per cent.

The division had funds under administration of $205.7 billion at the end of the latest half - down two per cent from December 2010.