St James’s Place saw net inflows halve in the first quarter of 2024, compared with the previous year, as it continues to carry out its review of the business and changes to its charging structure.
The firm is currently carrying out a review of the business in response to FCA concerns about ongoing charges.
In an update for the three months ended March 31 2024, the wealth manager reported net inflows were £710mn, compared with £2bn in the same period last year.
However, funds under management increased to around £179bn from £153bn the year before.
CEO, Mark Fitzpatrick, said this was driven by a strong period of investment returns.
Fitzpatrick put lower net inflows down to fewer working days in March, ahead of the tax year end period.
He said: “For the year to April 5, gross inflows are broadly unchanged on the equivalent period in 2023, reflecting an increased level of client activity, albeit with a lower average investment size.
“Meanwhile, outflows remain at an elevated level, continuing a trend we have seen across our industry, as clients continue to draw upon their savings to meet continued financial needs.”
Fitzpatrick said SJP is making “good progress” with its review of the business, the result of which will be published alongside its half-year results in the summer.
He added: “We also continue to move forward with our significant programmes of work to review historic client servicing records and to implement the new charging structure that we announced last October.
“Both programmes are proceeding in line with our plans and expectations, and the financial guidance associated with each of these remains unchanged.”
In its full year results in February, the firm set aside a provision of £426mn for potential client refunds to address ongoing advice issues, after it saw an uptick in complaints.
At the time, FitzPatrick said the firm had taken this very seriously and had already refunded charges to clients.
After the number of complaints accelerated towards the end of 2023, the firm said it engaged extensively with the FCA.
It came after the FCA had written to 20 of the biggest advice firms requesting information about their ongoing advice services on the back of the consumer duty.
Elsewhere, in October, SJP revised its charging structure for new investment bonds and pensions with an initial charge and ongoing charges but without any early withdrawal charges.
The firm said this was already the case with its unit trust and Isa business.
Fitzpatrick said: “While the outlook for the macroeconomic environment remains uncertain, our business is fundamentally in good shape as we continue to build our client base, grow adviser headcount, increase funds under management, and deliver for our clients.”
tara.o'connor@ft.com
What's your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
