AJ Bell warns of moderating revenue margins, added costs from ISA reforms

By Simone Lobo

Dec 4 (Reuters) - Investment platform AJ Bell on Thursday warned of added costs from Britain's Individual Savings Accounts (ISA) reforms and said its fiscal 2026 revenue margin would moderate after increased forex dealings this year, sending shares down 7%.

Its stock declined on the dim outlook even as the company reported a 22% rise in annual profit before tax and announced a 50 million pounds share buyback.

AJ Bell CEO Michael Summersgill told Reuters that the UK's ISA reforms are likely to drive up complexity and costs associated with the investment process.

Finance minister Rachel Reeves, in her November budget, announced a set of reforms to the ISA market in a bid to revive investment in Britain's sluggish stock market.

These reforms included cuts to the annual cash investments investors under 65 could save tax-free and charges on cash held in Stocks & Shares ISAs.

"I've never seen a more complex and misguided set of interventions into the ISA market. None of these things will help to achieve the stated aim, but they will add cost and complexity for providers and for customers," said Summersgill.

AJ Bell, which provides Stocks and Shares ISAs, noted that the reforms brought on additional requirements for ISA providers, such as age verification and checking the details of the product, which in turn could increase costs.

($1 = 0.7500 pounds)

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(Reporting by Simone Lobo in Bengaluru; Editing by Sherry Jacob-Phillips and Janane Venkatraman)