St. James’s Place could be set to overhaul its fee structure as it faces pressure from regulators to comply with consumer duty rules.
In response to “media speculation”, the wealth manager stated that it will continue to build on the work completed for the consumer duty, including an assessment of its fees and charging model.
This follows SJP’s half-year report and accounts in which it announced, in response to consumer duty, it would cap annual management charges on bond and pension investments for clients who have been invested for more than 10 years.
The firm stated the assessment of its fees and charging model will ensure SJP operates with a “simple and scalable” charging platform for the long term.
However, the evaluation has not yet been completed and therefore no decision has yet been made.
SJP has stated however that it is “confident” that all the options under consideration will “ensure value for clients" and a strong, secure, and sustainable business for all stakeholders.
“We naturally continue to engage with all of our primary regulators during this process,” the company stated.
St James’s Place added that it will update the market as soon as any decisions are made.
The firm saw its share price plunge by almost 10 per cent this morning in the wake of the announcement.
The announcement follows recent allegations against the company with one adviser describing being an adviser at the company is similar to being in a “gilded cage”.
This was said to be due to restrictions on exiting the company and high interest rates payable on loans taken out to buy client books.
FTAdviser previously reported that the average SJP adviser owes the firm £110,000 due to loans taken out to enable advisers to buy the businesses or client books or retiring advisers.
This figure, reportedly, excluded loans worth a further £273.2mn made by a network of five major banks.
At the time, a representative from St James's Place told FTAdviser the loans are to enable “succession planning” for advisers, and stated that this model has been “proven.”
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