SJP replatforming costs hit over £140m

St James’s Place has spent a total of £143.3m so far on its platform upgrade with technology provider IFDS.

The company’s results, published yesterday, show it spent £10.1m on its replatforming exercise in the first half of the year. In the same period in 2016, the company spent £10.5m.

SJP predicts costs related to the new platform in the second half of this year will be similar to the first half.

In the results, SJP says: “Our back-office infrastructure programme is a multi-year initiative to upgrade our administration so it can support our future business goals.

“Having achieved the migration of our Isa and unit trust proposition to our new Bluedoor platform in 2015, the focus in 2016 and early 2017 was the launch of a new retirement account with the eventual aim being to migrate pension and drawdown business onto the new system.”

In its results SJP reports an “operational readiness prepayment” related to the cost of the platform project.

The payment relates to costs charged by IFDS to deliver the new platform. The costs will be allocated over the course of the replatforming.

A spokesman for SJP says: “To confirm, the cumulative amount expended on operational readiness that was carried as a prepayment as at 30 June was £143.3m as reported in our latest accounts.”

At the end of the first half of 2016, SJP had spent £92.3m on the prepayment which had reached £121.1m by the end of 2016.

In the results, SJP calls the platform project its “biggest ever technology initiative”. 

The spokesman says: “We remain pleased with the progress of the phased migration of business on to the Bluedoor platform. Over a quarter of assets under management are on the Bluedoor platform and approximately two-thirds of all new investments are being processed on it.

“We expect this progress to continue in the same controlled and phased manner as we have achieved since the migration started, and are already experiencing contractually agreed reduced tariffs.” 

In May Old Mutual Wealth dropped IFDS as its technology provider in favour of a deal with FNZ.

Costs of the project reached £330m before Old Mutual Wealth terminated its contract with IFDS.