Wealth manager St James’s Place sees modest growth in net inflows

Britain’s largest wealth management firm St James’s Place saw net inflows slow in the first three months of the year as investor redemptions jumped. 

Net inflows during the opening quarter of 2023 declined to £2billion, compared to analyst expectations of £2.2billion and a record £2.91billion over the same period last year.

Brokers noted significant signs of a normalisation in customer redemptions towards pre-Covid trends, having been at lower volumes over the previous two years.

St James’s Place shares had fallen by 3.4 per cent to £11.98 on Thursday afternoon following the update, although they have still grown by approximately 12 per cent since the start of the year.

Investor confidence took a beating in March as a result of the collapse of Silicon Valley Bank and Signature Bank, the biggest bank failures in the US since the global financial crisis.

This triggered fears of another worldwide banking meltdown before intervention by central banks and other financial institutions helped prevent further turmoil.

Yet the level of SJP’s managed assets at the end of March was still 3.5 per cent up at £153.6billion, thanks primarily to a net investment return of £3.25billion.

Chief executive Andrew Croft said: ‘We have begun 2023 much as we expected, so if macroeconomic indicators and consumer sentiment show further signs of recovery, we continue to anticipate a more supportive environment for new business as 2023 unfolds.’ 

David McCann, an analyst at broker Numis, said: ‘SJP continues to be the stock we have the strongest positive conviction on in the sector.

‘At the heart of this view is the strong and consistent net organic growth…which has been delivered historically over a variety of different market conditions and which we expect to continue.

Fellow wealth manager Schroders revealed on Thursday that its assets under management dropped by £8.8billion to £737.5billion between December and March.

It also announced that chief financial officer Richard Keers would be standing down later this year after a decade in his position.

Schroders chief executive Peter Harrison said Keers, 60, had presided over a ‘period of robust growth and strong momentum across the business’.

His replacement will be Richard Oldfield, the current vice chairman and global markets leader at accountancy giant PricewaterhouseCoopers, where Keers was a partner for 16 years prior to his move to Schroders.

In addition to his current post, Oldfield has also been in charge of PwC’s clients and markets arm, strategy and communications, and its UK banking and capital markets assurance practice.

Schroders shares were 1.1 per cent down at £4.76 on early Thursday afternoon.