UK-based St James’s Place Capital, which has pursued an aggressive growth strategy based on a multi-tied financial advisor model, reported s...

UK-based St James’s Place Capital, which has pursued an aggressive growth strategy based on a multi-tied financial advisor model, reported strong growth in the first half of 2005. The group recorded a pre-tax operating profit of £45.9 million ($79.9 million), up 14 per cent year-on-year. The firm said the results were underpinned by strong growth in its pensions business in the lead up to pension reform in April 2006. The group, which is 60 per cent owned by HBOS, one of the major UK commercial banks, said fees from its wealth management division were up 27 per cent in the first half to £11.9 million. Total funds under management grew to £10.5 billion, a rise of 22 per cent on the same period a year ago. No breakdown of net new money was given. “The second quarter saw our highest ever quarter for new business which was up 29 per cent and funds under management exceeded £10 billion for the first time,” Mike Wilson, chairman of St James’s Place, said in a statement. He added: “Particular highlights for the six months were increases of 26 per cent in pensions business and 25 per cent in unit trust sales. We are seeing a growing demand for pensions and our advice based business model means that we will be well placed to take advantage of this in the lead up to pensions ‘A’ Day in April 2006.” The group said that new business growth was particularly strong in the second quarter of 2005, which saw a growth rate of 29 per cent year-on-year, compared with just 1 per cent in the first quarter. “This was our strongest ever quarterly new business performance and gives us an increase of 15 per cent for the year,” the firm said in its results statement. St James’s added, however, that it grew its financial advisor numbers by only three to 1,134 since the start of the year. “Although it is unlikely there will be any meaningful growth in partnership numbers at the year end, we have introduced a number of initiatives focusing on recruitment in the second half of the year,” said the group. “Every effort will be made, including the introduction of further initiatives if necessary, to achieve our stated objectives of increasing partner numbers by 5 – 10 per cent per annum.” St James’s said partner productivity rose 16 per cent during the first six months of this year compared with the same period last year. The approach of major pension reform in the UK, the so-called ‘A’ Day, is likely to be increasingly beneficial to the group, which was noted in its results statement. “We regard these changes as having a positive impact on the higher income market, as the demand from individuals grows – this will therefore benefit St. James’s Place.” The group said it will shortly be launching a pensions audit service for its clients and prospective clients to enable them to maximise the opportunities of the forthcoming pension reforms. Separately, the group has hired Roger Walsom and John Edwards as non-executive directors, the former as an independent director. Mr Walsom retired as a full-time partner from Ashurst, the city law firm, in April. Mr Edwards is chief executive of the insurance and investment division of HBOS.