A partner practice of St James’s Place has trotted out a stockbroking note to defend the wider wealth management group’s charging practices as it strives to reassure clients following a barrage of bad press.
The defence was featured in an excerpt from a client quarterly newsletter that was circulated on Twitter on Monday.
In it, the unidentified partner practice draws attention to a June research report from Numis, which it calls “one of the UK’s most respected Aim-listed institutional stock brokers”, that examines the investment case for owning SJP shares.
The client communication goes on to say that the “interesting point” from the research is “not that we [SJP] appear to be a company worth investing in” but that SJP’s customer charges are comparable to the typical IFA and “about mid-range”.
Value for money
“We find St James’s Place customer charges at c.2% pa all-inclusive and annualised are comparable on a like-for-like basis to typical IFA and associated provider costs, also at c.2%,” the Numis note cited in the newsletter reads.
“We calculate that St James’s Place’s charges are about mid-range when compared to other alternative investment choices a customer could make”.
“Considering we believe more in what value we provide for our charge we appreciate sometimes we may not focus on a physical cost, so this point is worth highlighting simply because on cost alone we are largely comparable to anyone else you may have chosen to work with,” the client communication continues. “As we are focused on value, we believe that what we provide to clients is excellent value, research supports our belief by discussing value rather than cost alone.”
‘Smacks of desperation’
Fundscape CEO Bella Caridade-Ferreira said: “It sounds to me like they’re running scared.”
“They’ve had a lot of unwanted attention on their fees from the series of Sunday Times stories and they’re trying desperately to recast themselves in a different light.”
“I think the tone of the message is poor, and smacks of desperation,” agreed Alistair Cunningham, financial planning director at Wingate Financial Planning.
SJP has been slated in the press this year with a series of stories emerging about its aggressive sales tactics, “cufflinks and cruises” rewards system, questions over transparency and allegations of a macho culture.
CWC Research director Clive Waller added that the decision to highlight a stockbroker’s note in a client newsletter is an odd choice, as weighing up SJP as an investment is different from recommending it to a potential customer.
“That is almost like saying that an asset manager investing in tobacco like Neil Woodford and Terry Smith is suggesting that smoking is good,” said Waller.
SJP responds
A spokesperson for SJP reiterated the excerpt was from a quarterly newsletter from an SJP partner practice “that covers a variety of topics for its clients”.
“As part of this, the practice wanted to highlight the independent research carried out by Numis showing SJP’s competitive charges in comparison to the marketplace,” the spokesperson said.
They added the newsletter is “bespoke” to the partner practice and “is not a central mailing to all SJP clients”.
