October 24, 2017 / 6:55 AM / in a year

UPDATE 2-St. James's Place funds lifted by pensions demand

* Funds under management 85.7 billion pounds at end-Sept

* Net inflows 2.4 bln stg; pension inflows 1.4 bln stg

* Shares among top FTSE 100 gainers, up 1 pct (Adds shares, analyst quote, CEO quote, background)

By Simon Jessop

LONDON, Oct 24 (Reuters) - Funds under management at St. James’s Place rose by 3.2 percent in the three months to the end of September, boosted by inflows into the British wealth manager’s pension products.

St. James’s Place, which offers savings, insurance and investment-related services to wealthy retail clients, said on Tuesday total funds were 85.7 billion pounds ($113 billion) at quarter-end, up from 83 billion at the end of June.

The gains were driven by net inflows of 2.4 billion pounds, of which 1.4 billion went into pension-related products, helped by a growing demand to consolidate pensions and take advantage of more flexible rules around accessing savings.

“As people look to get more control over their finances in their later life, pensions happen to be where the bulk of it sits,” outgoing Chief Executive David Bellamy told Reuters.

Net inflows into unit trust and tax-free savings products were also strong, at 800 million pounds, but market gains on its investments added just 240 million pounds, as weakness in the pound weighed on returns.

While total funds were “a touch light” compared with consensus, as a result of the muted market gains, the net inflows figure beat forecasts, Bernstein analyst Edward Houghton said in a note to clients, flagging an ‘outperform’ rating.

At 0711 GMT, shares in St James’s Place were up around 1 percent, the second-top gainer on the UK’s blue-chip FTSE 100 index.

Bellamy, in the company’s statement, said while political and macro uncertainties would persist, the company was confident “in the scale and quality of our relationship-based approach to the management of our clients’ financial affairs”

As a result, it was “well placed to meet the growing need for trusted advice and our medium-term growth objectives”.

The company said its net asset value on a European Embedded Value per share basis, a measure which discounts future cashflows, was 1,005 pence per share at the end of the quarter, or 990 pence after payment of an interim dividend on Sept. 29. ($1 = 0.7571 pounds) (Reporting by Simon Jessop; Editing by Dasha Afanasieva/David Holmes/Alexander Smith)

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