St James’s Place net inflows slow amid ‘challenging’ environment
Wealth manager St James’s Place (STJ) has recorded a rise in funds under management even as the pace of inflows slowed in the third quarter.
As at 30 September, total funds under management increased to £118.7bn compared with £112.82bn in 2019.
St James’s Place reported net inflows of £1.33bn in three months ended 30 September, down from £2.11bn in the same period last year.
Over the first nine months of the year, the wealth manager received net inflows of £5.96bn, down from £6.55bn from last year.
Chief executive Andrew Croft said that despite a “challenging external environment” St James’s Place had managed a “robust performance”.
Activity had picked up towards the end of the quarter amid hopes of an economic recovery, with activity for October at similar levels to last year. Asset managers recorded steep outflows at the start of the pandemic as market sentiment was dampened by uncertainty.
“Looking ahead, the uncertainty linked to Covid-19 will inevitably influence client investment, confidence and consequent decision-making,” Croft said.
“Our confidence in the medium to long-term outlook for our business remains unchanged. We see an increasing demand for sound, highly personal financial planning advice.”
The update comes a day after activist investor Prime Stone Capital wrote an open letter to the board of St James’s Place calling for an overhaul of the company’s cost base to improve shareholder returns.
On Monday the group revealed a 1.2 per cent stake in the wealth manager, worth almost £61m. In the letter sent to the bord, the activist criticised the wealth manager’s “bloated organisational structure” and “excessive pay”.
“The main criticism is on the lack of operating leverage which SJP has delivered, which given the strong top line growth the company has achieved, is a fair criticism in our view,” Shore Capital analysts said.