Billions of lockdown savings funnelled to funds

FILE PHOTO: Pound notes and coins are seen inside a cash register in a bar in Manchester, Britain
FILE PHOTO: Pound notes and coins are seen inside a cash register in a bar in Manchester, Britain September 6, 2017. REUTERS/Phil Noble//File Photo

July 28, 2021

(Reuters) – Asset managers St James’s Place, Rathbone and Man Group saw billions of pounds in inflows during the first half of the year, as household savings jumped during COVID-19 lockdowns, their results showed on Wednesday.

Wealth managers have seen their fortunes turn around drastically as stimulus cheques and vaccinations reassured investors about the economic outlook following the first few months of last year when clients pulled out money.

St. James’s Place (SJP) expects gross inflows to grow 20% in the second half of 2021, the money manager said, after attracting 5.5 billion pounds ($7.64 billion) in net inflows in the first half.

Improving confidence and an increase in household savings rates have helped attract 9.2 billion pounds of gross inflows, SJP’s chief executive Andrew Croft said in a statement.

Funds under management at SJP, which provides advice on investment and retirement planning, swelled to 143.8 billion pounds at end-June from 129.3 billion pounds in December.

Rathbone Brothers increased its interim dividend by 8% to 27 pence, following an 8.2% jump in total funds under management and administration to 59.2 billion pounds.

“Investment markets improved in the first half of 2021 as sentiment began to look beyond the pandemic,” Rathbone Brothers Chief Executive Paul Stockton said in a separate statement.

Shares in St. James’s Place (SJP) jumped 5.4% to the top of the FTSE 100, while hedge fund Man Group and Rathbone were up 2% and 1%, respectively, by 0809 GMT.

SJP reinstated its interim dividend and set an 11.55 pence a share payout.

Man Group raised its interim dividend by 14% to 5.6 cents per share and announced a $100 million share buyback plan as its funds under management rose to a record of $135.3 billion from $123.6 billion.

The company added that clients were interested in particular in alternative strategies, which typically aims to provide diversification.

($1 = 0.7197 pounds)

(Reporting by Muvija M and Chris Peters in Bengaluru; editing by John O’Donnell and Carolyn Cohn)