By Joe Stonor

Shares in the U.K.'s St. James's Place fell steeply as wealth management became the latest sector threatened by competition from AI-powered startups.

The FTSE 100 company dropped 12.6% to 12.66 pounds in morning European trade on Wednesday, marking its largest percentage decrease since February 2024. The stock is the second-sharpest faller in the Europe-wide Stoxx 600 index.

Investors were responding to the launch of a new AI-powered tax planning tool from U.S. financial-technology firm Altruist on Tuesday. The startup said its tool would help financial advisors produce "fully personalized tax strategies" in minutes.

Other U.K. wealth managers followed St. James's Place lower, with AJ Bell and Quilter dropping 6.7% and 5%, respectively. Rathbones Group was down 4.1%.

Elsewhere in Europe, Swiss giant UBS shares dropped 3.6%--extending the stock's difficult start to the year--while private bank Julius Baer fell 4.2%.

Some analysts see the selloff as an overreaction. The new Altruist tool will not replace advisors as some investors fear because of the holistic nature of wealth management, RBC analyst Ben Bathurst said.

The sharp falls in the wealth management sector are the result of traders "looking to replay a narrative that has played out in other industries, rather than representing any 'breakthrough' change in the industry fundamentals," Bathurst said.

St. James's Place manages over 220 billion pounds ($300.17 billion) via a network of nearly 5,000 financial advisors. In half-year results for 2025, published last July, the company said it was exploring the use of AI productivity tools for advisors.

The company argued the new Altruist tool would aid wealth advisors rather than replace them. The group's director of financial advice, Alexandra Loydon, said that the AI tool is designed for the U.S. tax system, which is different from the U.K.'s.

"However, we recognize the role AI does and will increasingly play in advising clients. Advisers are using AI now and we are hugely supportive and keen to support developments in this space where tools can complement the role advisers play," Loydon said.

U.S. financial stocks sold off heavily on the Altruist release Tuesday, with Raymond James falling 8.7%, while Charles Schwab dropped 7.4%. Both recovered slightly premarket, with futures tied to the pair climbing 2.3% and 0.3%, respectively.

Write to Joe Stonor at josephmichael.stonor@wsj.com

(END) Dow Jones Newswires

February 11, 2026 05:55 ET (10:55 GMT)

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