Investors are turning their backs on St James’s Place as the wealth manager grapples with a £426m overcharging scandal, its latest results show.
Money paid into the FTSE 100 company more than halved to £710m during the first three months of 2024, compared to the £2bn recorded during the same period last year, figures released on Tuesday revealed.
The UK’s largest wealth manager blamed the performance on large outflows as clients continue to withdraw savings to meet their financial needs.
Separately, the company’s year-on-year investor retention rate dipped from 95.9pc to 94.6pc. The money manager has nearly 960,000 clients.
The latest results come after St James’s Place set aside £426m for potential refunds in February for clients who were overcharged for advice they had not received.
Mark FitzPatrick, chief executive of St James’s Place, said the company continued to “move forward” with its review of historic client servicing records and the overhaul of its fee structure, including its controversial exit fees for clients leaving the business early.
The former Prudential boss previously described the overcharging scandal as a “historic issue” and denied it would damage trust between clients and advisers.
Mr FitzPatrick on Tuesday said the company was also making good progress with its business review designed to improve efficiency and boost profitability before 2030.
The company will share the outcome of its business review alongside its half-year results in the summer.
The Cirencester-based financial adviser had £179bn of funds under management last quarter, up 16.5pc from the equivalent period last year.
Its funds held £15.7bn in UK stocks last quarter, a year-on-year decrease from £16.4bn. Meanwhile, US equities jumped from £49.3bn to £64.9bn.
Mr FitzPatrick, who took the helm last December, said that although the macroeconomic outlook remained uncertain, the business would continue to build its client base, grow adviser headcount and increase funds under management.
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