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St James’s Place maintains inflows amid ‘uncertain external environment’

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Dozens of Tory MPs have written to Rishi Sunak demanding “emergency” funding for councils which they say are facing cash pressures “like never before” amid an election year.
Dozens of Tory MPs have written to Rishi Sunak demanding “emergency” funding for councils which they say are facing cash pressures “like never before” amid an election year.

St James’s Place has reported record funds under management (FUM) for the third quarter, after a challenging period for the wealth manager during which the rewards system offered to their partners came under scrutiny.

The company said total FUM at the end of September were a record £112.82bn, an increase of 3.2 per cent on the previous quarter.

Read more: St. James’s Place boss promises review of company’s incentives

Net inflows during the three months to September were £2.1bn, a 14 per cent drop compared to the same period last year.

“In what remains an uncertain external environment, these figures once again highlight the resilience of our business model,” said chief executive Andrew Croft.

“While political and macro-economic uncertainty may affect the pace of some discretionary investment flows from time to time, it has no bearing on the continuing need for holistic, long-term financial planning,” Croft said.

St James’s Place has recently faced criticism over its fee structure, which involves higher charges than many of its competitors, as well as the lavish incentive scheme offered to its partners.

Croft promised to make changes to the scheme offered to St James’s Place partners – self-employed financial advisers who operate under the company’s brand – after details of rewards ranging from white-gold cufflinks to luxury cruises were made public last month.

The wealth manager is currently holding a consultation into the rewards schemes that is due to be completed by the end of the year.

“The overseas trips are also very much business meetings. There’s an awful lot of business content to them, ” boss Croft told City PM

JP Morgan analyst Ashik Musaddi said the third quarter results were slightly ahead of consensus but in line with his expectations, but cautioned that ongoing uncertainty over Brexit was continuing to weigh on the company.

Read more: St James’s Place partners threaten rebellion over cancelled cruises

“Brexit continues to remain an overhang on St James’s Place’s gross flows momentum in the short term which is key for cash earnings and dividends,” he said.

Shares in the wealth manager were up 1.88 per cent at 1,032p at lunchtime.