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SJP: our future is not with Lloyds
by Alex Steger on Jul 28, 2011 at 07:52
St James’s Place (SJP) does not fit into the longer terms plans of majority shareholder Lloyds Banking Group, according to SJP chief executive David Bellamy.
Bellamy (pictured) said despite being spared the chop in Lloyds’ recent strategic review he did not see this as an indication SJP would remain within the Lloyds’ group long term.
‘They have signaled no selling at this time, but I don’t think we fit in the longer term plans,’ he said.
‘The strategic review was largely about the bigger business of Lloyds, the banking, the debt, and so on and so forth. All he [António Horta-Osório] said was "we are not planning to do anything with SJP at this time"; it was not part of the strategic review.’
SJP profits increased by over 50% to £55 million for the first half of 2011, although the company’s distribution arm failed to make a profit as adviser remuneration reduced as a result of the retail distribution review (RDR).
Overall profits before tax were up 52% to £55.3 million from £36.3 million in the first half of 2010, but the key driver for this result was higher income from increased funds under management. Assets increased to an average of £28 billion under management, a 27% rise on the same period last year.
The distribution business, which made a £5.9 million profit in the first half of 2010, failed to make a profit in the first six months of this year.
SJP said the declining margin in distribution was due to the RDR.
‘In 2011, the rate of income paid for distribution activity reduced, as a result of the equalisation of partner remuneration across product categories in anticipation of RDR,' it said.
'The associated drop in income results in the reporting of a profit of £nil (2010: £5.9 million) from distribution activity in the period, which is lower than in the same period last year.’
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