Midland wealth management group St James's Place Capital yesterday posted a 63 per cent rise in 2005 profits and said it was well placed to grow further, pushing shares to a near four-year high.
Pretax profit was £213.4 million, up from £130.9 million in 2004.
New business sales rose 25 per cent, ahead of the company's15 to 20 per cent long-term annual target, and it said it was well-placed to grow as the UK pensions market faces a regulatory shake-up.
"We are in a growth market and the board believes St. James's Place remains well positioned to capitalise on these opportunities," chief executive Mark Lund said.
The bank is 60 per cent-owned by HBOS and has no plans to buy out the remaining shares said chairman Mike Wilson. The company, which sells pensions and investments to affluent customers, is regarded as one of the biggest beneficiaries of new UK pension rules due on April 6, known as "A-Day".
The rules are aimed at encouraging people to save for retirement and give more flexibility in pensions.
"Because A-Day is so advice-driven it plays into our hands, because we are an advice-driven brand," said Mr Wilson. "But I think the important thing is A-Day allows our partners to get in front of high net worth individuals and talk to them - so it will help our business across the board."
New business profits were up 47 per cent £67.2 million, as St James's sold high-margin products while keeping a lid on costs, group finance director Andrew Croft said.
St James's Place is immune from the squeeze on profit margins in the wider UK life industry, Mr Croft added.
The firm has its own dedicated sales force, which means, unlike rivals, it does not have to offer higher incentives to independent advisers to sell products as the competitive climate hots up.
But the growth in the size of its force of financial advisers, called partners, was slower than expected, which acted as a slight drag on sales.
"Clearly the growth would have been even greater if we'd had a significant increase in the number of partners," Mr Wilson said.
The company has appointed a new recruitment director as part of its drive to boost the number of sales partners.
The firm set a final dividend of 1.85 pence to give a total payout of 3.15p, versus 2.85p in 2004.