St James’s Place wants to cut costs by around £100mn per annum by the end of 2026 after going through a "challenging" period.
In its half year results, published today (July 30), the wealth manager revealed its cost base reduction programme which will result in savings of around £500mn, it said.
SJP confirmed half of these savings would be invested back into the business between 2025 and 2030.
Mark FitzPatrick, chief executive of SJP, highlighted it has been a “challenging period” for the business and said it had “a lot of hard work” ahead of it over the next 24 months.
He also said the wealth manager was “progressing” with its ongoing advice review and was comfortable that the £426mn set aside for potential refunds was “appropriate”.
According to the results, as part of the review a “skilled person” undertook an initial assessment of a representative cohort of clients to explore whether issues raised by the complaints were replicated across the wider client bank.
SJP said: “Following the assessment, the group has committed to review the sub-population of clients that has been charged for ongoing servicing since the start of 2018 but where the evidence of delivery falls below the acceptable standard.
“Where the standard of evidence is deemed by the group to be marginal the group will invite clients to join the review, but where the standard of evidence is deemed to be poor the group will include clients in the review unless instructed otherwise.”
It also confirmed during the commencement of the review, costs were incurred to the amount of £0.5mn.
According to the results, in the six months ended June 30 2024, SJP reported income from advice charges totalling £528.1mn, which it said included the provision of initial and ongoing advice.
Other results
Elsewhere, the company reported gross inflows of £8.5bn as well as a net 3 per cent increase in client base to 988,000.
It also reported strong retention of client funds at 94.6 per cent and record funds under management of £181.9bn.
The business said market opportunity remained “compelling” due to the rising demand for advice and unveiled its future strategic focus built around four pillars.
These included simplifying and standardising operations, enhancing client propositions, continuing to be the “best place to be a financial adviser in the UK” and fostering empowerment and accountability.
FitzPatrick said: “We are positioning for further success, and I am confident that our refreshed strategic focus leaves us well placed for a very bright future ahead.”
alina.khan@ft.com
