TL;DR

Europe’s largest wealth managers are accelerating AI adoption after US fintech Altruist launched an AI tax planning tool that sent sector shares tumbling. St James’s Place, Schroders, and Lombard Odier argue the technology will make advisers more productive, not replace them — but warn competitors slow to adopt AI risk losing clients.

Shares Tumble, AI Adoption Accelerates

Wealth management stocks fell this month after Altruist unveiled an AI tool that helps advisers create tax strategies within minutes by interpreting payslips and modelling scenarios like property sales or retirement transitions. The launch revived concerns that parts of the advisory industry could become obsolete.

The response from Europe’s top firms has been defensive but pointed. Mark FitzPatrick, chief executive of St James’s Place (which oversees roughly £220bn), said advisers who don’t use AI “may well be replaced by those that do.” He told the Financial Times that AI was “going to put the work that advisers do on steroids” by boosting productivity.

St James’s Place is already enabling its 5,000 advisers to use AI for recording conversations and preparing client recommendations, with an internal ChatGPT-style tool called ChatSJP providing rapid answers to technical questions.

Where the Real Risk Lies

Industry figures drew a sharp line between general financial guidance and regulated financial advice. One fund manager said guidance was “eminently disruptable by AI,” but full financial advice remained “a people business” where clients struggle to trust even human advisers with large sums.

Richard Oldfield, Schroders’ chief executive, said providers serving the “mass affluent” market — rather than very wealthy clients with complicated needs — faced the greatest risk. Lombard Odier’s technology head Geoffroy de Ridder said “every simple activity” currently done by humans could be replaced or complemented by AI, reporting that compliance processes are now running 20 to 50 times faster.

An Oliver Wyman survey of 300,000 investors found AI use for investing jumped to 44% from 34% over two years, with many feeling AI “understands their situation better and is less judgmental than human advisers.”

Looking Forward

Jefferies analyst Julian Roberts noted that AI firms are selling to advisers rather than directly to their clients — partly because it is an easier route to market with fewer regulatory hurdles. For now, the technology appears to be augmenting rather than replacing human advisers, but firms slow to adopt face losing ground to more agile competitors.