St. James's Place net April inflows cheer investors, analysts

By Sinead Cruise

LONDON (Reuters) - Asset manager St James's Place <SJP.L> reported a 1% rise in year-on-year net inflows to 810 million pounds in April as clients resisted panic and continued to invest in the face of the coronavirus and its likely impact on their wealth.

In a trading update on Wednesday, St James's said the positive net inflow combined with a positive investment return last month saw funds under management rise to 108.8 billion pounds ($134 billion), compared with 107.2 billion pounds last year.

Shares were trading 6.5% higher at 0756 GMT after analysts at Bank of America and JPM Cazenove cheered the resilience of the wealth manager's business model, which continued to attract cash during the tightest phase of Britain's COVID-19 lockdown.

"Following record first quarter new business, we have naturally seen a reduction in new investments as the COVID-19 crisis developed," Andrew Croft, Chief Executive, said, adding that gross April inflows were 13% lower than the same month last year.

"We are encouraged by the robust gross and net inflows we have continued to experience during May, though the short to medium-term impact of government measures and economic volatility on our flows remains uncertain."

Many asset managers have suffered falls in assets under management as clients run shy of higher-risk investment amid fears that lockdowns to prevent the spread of the new coronavirus will hammer global economic growth.

In light of the need to observe social distancing, St. James's said it has adapted to managing client relationships 'virtually', resulting in strong client retention last month.

(Reporting By Sinead Cruise, editing by Huw Jones)