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St James's Place sees funds under management drop by £5bn, but net inflows hit quarterly record

The blue-chip wealth manager said its total assets were £95.5bn as at 31 December 2018, down from £100.59bn at the end of September
Wealth growing
However, the company said it still saw record quarterly net inflows to its funds of £2.6bn

St James's Place PLC (LON:STJ) saw its shares rise on Thursday as news of a £5bn drop in its assets under management in the fourth quarter of 2018 was balanced by record quarterly fund inflows for the FTSE 100-listed group.

In a trading update for the three months to 31 December 2018, the wealth manager said its total assets were £95.5bn at the period-end, down from £100.59bn at the end of September.

READ: St James's Place reports strong third quarter inflows of new client cash

However, the company reported quarterly net inflows of £2.6bn as clients continued to seek face-to-face advice on a range of services from pensions to tax planning.

Over the full-year, St James’s Place’s said its funds under management rose by 5%, while the net inflow of funds was £10.3bn, up 8%, with a client funds retention rate of 96%.

Andrew Croft, St James’s Place’s chief executive, commented: "While challenging market conditions, like those currently being experienced, will slow the pace of fund inflows from time to time, the fundamentals of our clients' financial planning requirements remain unchanged.

“I firmly believe that, with the continued focus on achieving the best possible outcomes for our clients through the provision of trusted face-to-face financial advice and our distinctive investment management approach, we remain extremely well placed to continue to grow our business in line with our objectives over the medium term."

Resilient performance

In a note to clients, analysts at UBS commented: “These results continue to prove the resilience of the business although testing conditions remain and the pace of pension slowdown from here warrants caution.

“Asset retention levels remain resilient although we need to monitor this through 2019 given MiFID II charges transparency rules which we view as a bigger test of the long-term investment case rather than short-term flows.”

UBS retained a ‘neutral’ rating and 950p price target on St James’s Capital shares which in late morning trading were 3,.2% higher at 971.80p.

 -- Adds analyst comment, share price --

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