UPDATE 2-Hargreaves says trading volumes ease after retail spike

* Hargreaves AUA, inflows rise

* But company starting to see dealing volumes ease

* Total active clients reach 1.6 million (Adds details from statement, Brewin results)

May 13 (Reuters) - Investment platform Hargreaves Lansdown has started to see a fall in share dealing volumes as pandemic curbs ease, it said on Thursday, after record retail trading at the start of the year.

Britain’s biggest fund supermarket said revenue for the four months to the end of April jumped to 233.2 million pounds ($327.6 million) from 190.2 million pounds, citing strong trading in international equities, particularly U.S. stocks.

The UK-listed company, which won 126,000 new clients over the four months, lifting its total active clients to 1.6 million, said assets under administration reached 132.9 billion pounds in that period, up from 120.6 billion pounds.

“Conditions look more positive than they did at the end of December,” Hargreaves Chief Executive Chris Hill said.

Also on Thursday, wealth manager Brewin Dolphin reported an 11% jump in total funds to 52.6 billion pounds, saying total discretionary fund inflows in the first three months of 2021 were at a record 1 billion pounds.

However, Hargreaves said in its trading update that similar to when previous lockdowns have been lifted, it has begun to see a reduction in share dealing volumes in UK and overseas trades.

On Wednesday TP ICAP, the world’s largest interdealer broker, said trading activity had returned to normal levels in April as it reported a 9% fall in first-quarter revenue.

Hargreaves said its growing client base, easy-to-use platform and the breadth of equities available made it confident that dealing volumes will be higher than pre-pandemic levels.

The company said costs related to having managed such high trading volumes earlier in the year and the spike in new clients and marketing will flow into the second half of its fiscal year.

“What we have are elevated levels of trading revenue paying for onboarding costs of client relationships which will last for decades. We view this as underpinning its investment case and retain our Buy recommendation,” Panmure Gordon analysts wrote.

Hargreaves shares were down 5% by 0756 GMT, while the wider market was 2% lower on inflation worries.

($1 = 0.7119 pounds)

Reporting by Muvija M in Bengaluru, Editing by Sherry Jacob-Phillips and Elaine Hardcastle