City of London Investment Group (“CLIG”) has issued a FY trading update indicating that FY17e earnings are expected to be 7% ahead of our forecasts and that FuM grew by 7% in Q4. FY17e PBT is expected to be £11.6m when final results are reported on 18th September. The board has recommended a small increase in the final dividend to 17p (FY16 16p). FuM grew by 6.8% to $4.7bn over the final quarter driven in the main part by positive underlying benchmark performance. We will update our forecasts for the positive earnings indication. We recognise that CLIG shares offer a healthy dividend yield (6%+) but net inflows are not being sustained. We remain at HOLD.
