Hargreaves hit as savers hold on to their cash

HARGREAVES Lansdown suffered a slump in profits as markets slid and savers held on to their cash.

The investment platform pulled in new business worth £5.5bn in the year to June 2022 – down 37pc from the previous 12 months.

And the amount which it invests for savers slipped by 9pc to £123.8bn, driven by market falls. This weighed on profits, which fell 26pc to £269.2m.

Despite the dip from last year – when activity was driven by the pandemic savings boom, and rising markets as lockdowns ended – chief executive Chris Hill was pleased performance was strong ‘against a macroeconomic and geopolitical climate which we haven’t see in a generation’.

Shares rose 5pc, or 42p, to 885.8p, as the profit beat analysts’ expectations by around 5pc. Hill said that while activity had been lower in the second half of Hargreaves’ financial year, it had still enjoyed one of its busiest tax year-ends in March and April.

Customers were funnelling money into their ISAs and selfinvested personal pensions before losing their allowances, being ‘incredibly logical’ despite inflation fears.

A recent online note which it posted for investors on how to cope with the rising cost of living had attracted 100,000 views, Hill said.

The results came just a day after Bank of England said it was expecting the country to tumble into a recession from the final quarter of this year, until the end of 2023. Hill said: ‘This had to be a reality check. what that means for ordinary people is pretty bleak.’

But having invested in new products over the last year, such as a growth fund, savings accounts and a forthcoming advice service, Hargreaves hopes to pull in worried savers who are looking to guard their nest-eggs.