Money Marketing
16 April 2003

  • 'Isa failure spells end of pricey mailshots'

    17 Apr 2003

    The failure of this year's Isa season will force fund firms to scrap expensive mailshots in favour of simple, point-of-sale marketing aids, says Credit Suisse Asset Management. Writing in this week's Money Marketing, managing director Ian Chimes says fund managers must take drastic action to change the way they market funds to IFAs and their clients as mailshots are likely to become an onerous cost. Predicting the death of the year-end rush for Isas, Chimes says ...

  • 'Merging small funds could save £700m a year'

    17 Apr 2003

    The UK fund industry is wasting £700m a year running small, inefficient funds which should be merged to slash high cost-to-income ratios, according to Mercer Oliver Wyman. It estimates that 55 per cent of the 2,000-plus funds in the UK have less than £40m under management, which Mercer reckons is the threshold needed for firms to turn a profit. Around 285 funds have less than £25m, which is a level, according to Mercer, where costs outstrip annual management fees. Mercer ...

  • 'Nothing done to encourage saving'

    17 Apr 2003

    The Conservatives and the Confederation of British Industry have accused Chancellor Gordon Brown of doing nothing in last week's Budget to get people to save. Both Shadow Chancellor Michael Howard and CBI director general Digby Jones expressed grave concern about the state of UK savings at the ABI's annual conference. Jones said one of his biggest worries is that there is nothing to motivate young people to save and the Government has failed to take action in this ...

  • 'Pru has shown utter contempt for our clients'

    17 Apr 2003

    The phones lit up at Money Marketing this week when Prudential told IFAs that not only would it be increasing critical-illness cover rates and pulling out of underwriting guaranteed business but that the move would affect the thousands of cases that are still in the pipeline awaiting processing. Here is a small sample of the reactions from IFAs to what has been seen unanimously as a cynical move by the Pru. "This action shows a cavalier approach to our customers' need ...

  • 'Treasury's Euro lapse left us with general regulation'

    17 Apr 2003

    The FSA's hands are tied over the introduction of statutory regulation of general insurance because the Treasury failed to enter into negotiations with the European Union over the Insurance Mediation Directive early enough, said FSA chairman Howard Davies last week. Speaking at the first annual ABI conference last week in London, Davies said the cost-benefit analysis that the FSA is required to carry out is likely to show that the benefits of introducing regulation will not ...

  • 29% boost in business for Hay

    17 Apr 2003

    Abbey National's specialist pensions administrator James Hay Pension Trustees has seen a 29 per cent rise in its corporate business for the first quarter.

  • 80% of funds are following a benchmark

    17 Apr 2003

    More than three-quarters of UK funds are managed under contracts which require them to track an index or stay close to a specific benchmark, according to the Investment Management Association. An IMA report, based on a poll of 55 fund managers, reveals that around 60 per cent of assets are managed with a single tracker mandate while 21 per cent are managed against a customised benchmark. This means that less than one-fifth of fund manager investments are true stock picks. Despite ...

  • Aifa sets up new body for loan advisers

    17 Apr 2003

    Aifa is urging mortgage advisers to join its new trade association. The Association of Mortgage Intermediaries will operate as a division of Aifa with its own board which will determine policy on mortgage intermediation. Chairman will be TQ Mortgage Service chief executive and former Namba steering committee chairman Charles Gooding. AMI fees range from £160 per firm plus £20 per adviser for firms with one to five RIs to a £3,000 flat fee for firms with ...

  • AIG Life - High Income Stockmarket Bond

    16 Apr 2003

    Wednesday, April 16 2003 Type: Capital protected bondAim: Income or growth linked to the performance of the FTSE 100 indexMinimum-maximum investment: £5,000-no maximumTerm: Four yearsGuarantee: Original capital returned in full providing index level is the same at the end of the termReturn: Choice of 6% gross income a year, 0.485% gross income a month or 25.65% growth at the end of the termClosing date: April 30, 2003 Commission: ...

  • Allied Irish Offshore - Secure Combination Bond

    22 Apr 2003

    Tuesday, 22 April 2003 Type: Guaranteed equity bond and high interest accountGUARANTEED EQUITY BONDAim: Growth linked to the performance of the S&P 500, FTSE Eurotop, Nikkei 300 indicesMinimum-maximum investment: £4,000, euros 4,000-noneTerm: Six yearsGuarantee: Original capital returned in full regardless of performance in the indicesReturn: Up to 50% growth at end of termClosing date: May 7, 2003HIGH INTEREST ...

  • Annuity Bureau calls for rethink on Omo factsheet

    17 Apr 2003

    The open market annuity option factsheet is failing to get its message over to consumers and its format should be reviewed, says Annuity Bureau head of marketing David Marlow. ABI figures show that the share of annuities bought by people exercising the Omo dropped in the quarter after the FSA introduced the requirement for life companies to notify customers that they might be able to get a better deal with another provider. The ABI sales figures show that the proportion ...

  • Ask the family

    17 Apr 2003

    Personal finance stories are no longer confined to just the financial pages, they are increasingly being seen on the news pages and even the front pages of many newspapers. Like it or not, finance has also spilled over into our dinner conversations - house prices, pensions and savings have all become hot dinner table topics. A topic that is often discussed is the cost of higher education. The deposit on a first home (with associated fees) is around £8,000. A typical three-year ...

  • B&W Deloitte to research price cap level

    17 Apr 2003

    The Government has appointed consultancy B&W Deloitte to conduct independent research into what level the price cap should be for the Sandler suite of products. Caroline Barr, who is currently head of benefit reform at the Treasury but is becoming head of fund management after Easter, revealed the move in a debate on the Sandler proposals at the ABI's annual conference. The consultancy will have 10 weeks to conduct its comparative study of how different price-cap ...

  • Ban for agent who 'preyed on clients'

    17 Apr 2003

    The FSA has obtained a permanent injunction against unqualified accountant and bookkeeper Alan Evitts, preventing him illegally taking deposits from investors. The High Court heard that Evitts, from Glossop, Derbyshire, had illegally taken nearly £150,000 in deposits from potential investors and made a number of false and misleading statements. The court order also prevents him from making future misleading or false statements in order to persuade people to give ...

  • Barrage of protests at lifetime limit

    17 Apr 2003

    The Inland Revenue's proposal for a £1.4m lifetime fund limit linked to prices has come under fire from across the pension industry as its tax simplification consultation closes. Norwich Union says it is nonsense to base the lifetime limit on the value of the fund at retirement rather than on contributions as this will penalise good fund performance. The National Association of Pension Funds is calling for the lifetime limit to be scrapped as it risks alienating ...

  • Bear necessities

    17 Apr 2003

    Investor confidence is at an all-time low, with the bear market biting ever harder. No wonder investors are scared to risk their capital. The plight of IFAs is no better. With what confidence can they advise clients to invest? Into what type of investments should they recommend that clients put their savings? The one thing that investors really want is protection. They may require a reasonable rate of return but that is secondary to capital protection. In my opinion, ...

  • Boulger warns long fixes could push up house prices

    17 Apr 2003

    Income multiples on loans and property prices could soar if long-term fixedrate mortgages take a grip on the market, says Charcol senior technical manager Ray Boulger. He warns that an increased market for longterm loans would lead to a reduced risk of repossession which would result in lenders increasing earnings' multiples by up to seven times income. In last week's Budget, Chancellor Gordon Brown announced a review into the reasons for low take-up of longer fixed-rate ...

  • Breakdown in communications

    17 Apr 2003

    You know times are tough in the offshore industry when they start scaling back on basic telecomms. The Diary understands that Scottish Equitable International's marketing department is down to one mobile phone between them - but it could have been worse without the selfless efforts of product marketing manager Steve Whalley, who spurned the chance of a personal phone so the team could share one.

  • Brewery boss to be Standard chairman

    17 Apr 2003

    Standard Life has appointed Sir Brian Stewart as its new chairman to take over from John Trott who retires on June 30. Stewart is chairman of brewing giant Scottish & Newcastle. He has been a non-executive director of Standard since April 1993. Trott has been with the life office since joining as a non-executive director in January 1974.

  • Brokers in legal threat as Pru pulls protection plug

    17 Apr 2003

    A leading protection broker is threatening a class action law suit against the Prudential after it raised premiums and withdrew guarantees on new and pipeline critical-illness business. Many IFAs are outraged and are vowing never to place business with the Pru again. Thousands of cases are affected by the move even though many applications were sent in months ago but delayed in an admin backlog. National broker Lifesearch is instructing its solicitors, Whitman Breed Abbott ...

  • Caps off for Sir Howard

    17 Apr 2003

    Never in the history of the FSA has Money Marketing agreed more with the views of chief regulator Sir Howard Davies. The last combined chairman and chief executive has told the world he does not believe price caps work. He chose an ABI conference to say he disagreed with one of the fundamental strands of Government policy, adding that he had not seen price caps work in other industries. The intervention is timely, coming just as the Government wants to escalate ...

  • Charcol linking with Freeserve to offer loan guide

    17 Apr 2003

    Mortgage IFA Charcol and internet service provider Freeserve have linked up to offer a co-branded mortgage guide on the internet. Choosing the Right Mortgage will be available on the Freeserve site for six weeks. If the guide proves popular, it could be the first of a series. The two companies first teamed up in 2000 when the Charcol website was linked to Freeserve. Charcol sees the partnership as a useful way of accessing a potentially large customer base. The ...

  • Clean air act

    17 Apr 2003

    Secure Air Systems is an enterprise investment scheme that aims to raise between £6m and £10m to market technology designed to combat biological and chemical impurities in the air. There are two different types of technology, which were both developed by scientists at the Cambridge Science Park. One type is designed to remove harmful biological and chemical elements from public places such as offices and underground train stations by using microwaves. This concept ...

  • Close Property Investment - Property Investment Portfolio

    18 Apr 2003

    Friday, April 18 2003 Type: Offshore fund of fundsAim: Growth or income by investing in property fundsMinimum investment: lump sum £11,000, $15,000, euros 16,000Place of registration: Isle of ManInvestment split: Choice of freehold income trust, capital appreciation trust, active commercial estates plc, healthcare and leisure property fund, Close high income properties plcYield: 5% gross a yearCharges: Initial 5%Commission: ...

  • Compulsive arguments for pension expansion

    17 Apr 2003

    In December, the Government appointed Adair Turner to chair a pension commission that will review whether the voluntarist regime for UK private pensions and long-term savings is on track. This potentially paves the way for employer compulsion should the review conclude that the current voluntarist approach cannot be made to work. AT Kearney analysis indicates that if compulsion is set at 4 per cent - the figure suggested in the Pickering report - this could generate an extra £5bn ...

  • Consumers using trees but they still want advice

    17 Apr 2003

    Consumers have used decision trees when deciding whether to buy a stakeholder pension but most still want access to professional advice, according to FSA research. The regulator's consumer and provider research into stakeholder and decision trees was published this week, a month after headline results were revealed at an FSA seminar into the sales process for the Sandler suite of products. The research says 59 per cent of consumers thought decision trees played some ...

  • Co-op Bank launches guaranteed stockmarket bond

    22 Apr 2003

    The Co-operative Bank is launching a new guaranteed stock market bond targeted at more cautious investors. Holders of the new bond can invest a minimum £3000 up to £1m for five years. When the bond matures in 2008 its final return will be based on the average level of the index over the last 12 months of the term.

  • DBS MD Pearson to head Misys mega firm

    17 Apr 2003

    Misys has appointed DBS managing director Steven Pearson to head its new combined mega network of 4,000 member firms. Pearson, who was also previously managing director of Financial Options, will take control as MD of the mega network group created by collapsing all five of its existing IFA networks, Countrywide, DBS, Financial Options, IFA Network and Kestrel, into one. The new name for the network will be revealed next month. Misys says the move will save £250,000 ...

  • Downing heads north on nursery quest

    22 Apr 2003

    Downing Corporate Finance is raising an additional £5.5m for the Downing Nurseries EIS to fund the purchase and management of between four and nine nurseries around the UK, excluding London. The EIS was established in March 2002 to build a group of children's nurseries and has raised £3m so far. Under the original share offer, the management of the nurseries was outsourced to a company called Nu Nu. Downing is now in the process of acquiring Nu Nu, which ...

  • DWP and MPs say pension system is basically sound

    17 Apr 2003

    The Department for Work and Pensions and MPs believe the pension system is sound despite widespread claims of a pension crisis. Tory MPs were defeated on a pension crisis vote by the select committee which scrutinises the DWP. The committee's report, published this week, backs the DWP view that while the UK has problems with pension provision, there is no crisis, with UK pensions "basically sound". The report calls for Adair Turner's pensions commission to expand ...

  • Enterprise Investment Scheme - The Water Machine

    17 Apr 2003

    Thursday, 17 April 2003 Aim: Growth by investing in a water handling and purification systemMinimum investment: Lump sum £2,500Opening/closing date: March 26, 2003/May 30, 2003 Charges: ImplicitCommission: Initial 2.5%Contact: www.thewatermachine.co.uk

  • Fidelity extends free transfer deal

    17 Apr 2003

    Fidelity is extending its 0 per cent initial charge offer period for Isa and Pep transfers into its investment trust range until April 30. Transfers can be made individually into a range of five trusts or into its 5-in-1 investment trust Isa package.

  • Fidelity lifespan Fofs in bid to smooth volatility

    17 Apr 2003

    Fidelity is seeking to transform the UK investment market with US-style limited lifespan funds of funds which aim to smooth volatility by making lifestyle-type switching through asset classes. The three fettered wealthbuilder target funds will invest in Fidelity equity funds at their launch in May and gradually increase their exposure to bond funds before moving towards cash near their end dates - 2010, 2015 and 2020. When they hit these points, the funds' asset mixes ...

  • Fixed loans on the Live agenda

    17 Apr 2003

    Just when you thought you knew what to expect from mortgage regulation, the Government has bowled the industry a googly in the form of Chancellor Gordon Brown's review into long-term fixed-rate mortgages, announced in the Budget. On the agenda at this year's Money Marketing Live roadshow at London's Olympia on May 13 will be a talk on the implications of the Chancellor's new initiative and the industry is already preparing its views. Some believe that if the ...

  • Framlington appoints new chief executive

    16 Apr 2003

    Framlington has appointed Peter Chambers as chief executive.Chambers was previously chief investment officer at Gartmore. He replaces Mike Vogel, who resigned in January to set up an independent private client investment business.Lord Douro, Chairman says: "I am pleased to announce the Board's decision to appoint Peter Chambers.  He will be joining Framlington as soon as possible." 

  • Freeze on stamp duty threshold condemned as another stealth tax

    17 Apr 2003

    The Chancellor's announcement that he freeze on thresholds for stamp duty on homes and business properties has brought an angry response from mortgage brokers who are branding it a stealth tax. Stamp duty will remain at 1 per cent on properties priced over £60,000, rising to 3 per cent on properties over £250,000 and 4 per cent on properties at £500,001 and above. Brokers say this is unfair as it does not take account of property inflation and they are ...

  • Friendlies want immediate start for child trust funds

    17 Apr 2003

    Friendly societies have welcomed the introduction of child trust funds from 2005 but are calling on the Chancellor to allow additional contributions to be made straight away. The initial Government payment into the fund at birth has been set at £250 for every child. This will be raised to £500 for children from low-income families who qualify for child tax credit. Additional contributions from parents, family members and friends will be allowed up to an annual ...

  • GE Life pumps millions into The Bureaux

    17 Apr 2003

    GE Life is injecting a multi-million pound sum into IFA The Bureaux Group to fuel an organic expansion plan with the target of Aim listing in five years. The deal gives GE Life, which is part of one of the world's biggest companies, an option on shares in the specialist IFA that comprises The Annuity Bureau, The Drawdown Bureau and The Care Funding Bureau. GE Life says it will not interfere with the management of the firm. The cash injection of an undisclosed seven-figure ...

  • Hambro's Costar says bull has come in from the cold

    17 Apr 2003

    Highly rated J O Hambro fund manager Mark Costar believes there is clear evidence that the UK is in a bull market despite the gloomy predictions of most rival investment houses. Costar, who runs the boutique's flagship UK growth fund, says the resumption of corporate activity in the weeks following the market low in mid March combined with attractive valuations have convinced him that the stockmarket has entered a bull run. He says the rallies over recent weeks demonstrate ...

  • Hopes rise on deal to end InterAlliance dispute

    17 Apr 2003

    Former director of Inter-Alliance (Edinburgh) Robin McGowan is hoping to reach an agreement with the national IFA after an eight-month dispute over a franchise transfer agreement. McGowan was an IA Edinburgh Franchise practice director and is looking to draw a line under the dispute which began in June 2002 when the national embarked on a radical restructuring of the company. This entailed transferring ownership of all Inter-Alliance's franchised businesses directly to the ...

  • IFA greets closure of loophole

    17 Apr 2003

    National IFA the Millfield Partnership has welcomed the Chancellor's decision to remove the little known 5 per cent deferral option on life policies. Current legislation allows the deferral of gains when the proceeds from a maturing life insurance policy are reinvested in a new policy with the same insurer. The holder then has a second chance to make tax-deferred 5 per cent withdrawals. The new proposals close this loophole, which had potentially meant that policyholders ...

  • IFAs moving to networks to reduce risks

    17 Apr 2003

    I read with interest the article by Gary Dixon of Compliance Solutions (Money Marketing, April 3). From a network perspective, the headline promised to challenge the future validity of my business and many others which, in aggregate, support over half the country's IFA population - nothing new there then. But times are certainly changing. I would agree that PI underwriters decide at will whether a firm can be covered or if they are to be in breach of FSA requirements. The ...

  • Income-seeking Isas dominate Cofunds top 20

    17 Apr 2003

    Sales figures from IFA fund supermarket Cofunds show that income-seeking funds were by far the most popular choice in the recently closed Isa season. The number of incomeseeking funds in Cofunds' top 20 best sellers has more than doubled this year and represents 16 funds from seven in the previous season. No smaller company, European or specialist funds made it into this year's top 20 while the number of UK funds has increased from 14 to 17. Distribution funds also ...

  • Independent view

    17 Apr 2003

    Despite the troubles and uncertainties prevailing in the world today, there are still many causes for celebration. In the case of Fiona Price & Partners, the occasion was our 15th anniversary. When Fiona set up the company back in March 1988 she was met by ridicule and scorn by many of her peers (all men). "An IFA firm specialising in advising women, she must be crazy." They could not see a market, despite the fact that women were making up an increasing percentage ...

  • Ingledew to be chief exec in BBB shake-up

    17 Apr 2003

    Chief executive Cliff Lockyer is to become chairman of national IFA group Berkeley Berry Birch in a board shake-up, with his deputy Stephen Ingledew becoming chief executive. The group has tried unsuccessfully since the start of the year to attract a non-executive chairman to replace Sir Jeremy Black, who retired at the end of 2002. The moves, effective from the end of May, follow last week's report in Money Marketing that BBB is conducting a strategic review which ...

  • Inside Edge

    17 Apr 2003

    •"March 2000: Isa mailing list for sale - 100,000 wonderful cross-selling opportunities." •"March 2003: Isa mailing list for sale - 100,000 very high maintenance unhappy clients." What a difference three years makes. We are now at a key turning point in investor psychology and there are a number of harsh truths that we need to face up to. The mailing lists made up of so many people who have taken out Isas in previous years that should have provided ...

  • Insight rebrands Rothschild funds

    22 Apr 2003

    The majority of funds Insight Investment bought from Rothschild Asset Management last year will be rebranded to carry the name of their new owner on May 1.

  • Insurance chief execs pour scorn on Sandler suite

    17 Apr 2003

    An ABI report says the vast majority of UK insurance chief executives believe that a price-capped Sandler suite of products will make no impact or very little impact on closing the savings gap. Ninety-one per cent of the 76 chief executive responding to the survey last week said they were not convinced that the proposed products will have an effect on the market. Seventy-seven per cent said additional tax incentives for employers who contribute to their employee's ...

  • Investment update

    17 Apr 2003

    It was a mixed week for the major financial markets. Most closed the week lower after a number of difficult sessions saw attention switch from the successes in Iraq to the state of the global economy. By close of play on Friday, the benchmark FTSE World index had fallen by 0.5 per cent. However, European markets bucked the downward trend, with the FTSE Eurotop 300 index edging up by 0.5 per cent. In the US, the Dow surged ahead by more than 200 points early on Monday but most ...

  • Investment view

    17 Apr 2003

    Watching, as I did, the coincidence of the delivery of the 2003 Budget and the fall of Baghdad from the comfort of a sun-drenched terrace several hundred miles south of the City, I could not help but think the Chancellor had missed a trick. Wednesday last week was surely the day to slip in that tax increase that is looking more and more necessary. Who would have spotted the sleight of hand when the images of the day were dominated by a toppling statue? Knowing that the monetary ...

  • Isa in a basket

    17 Apr 2003

    The Skandia protected multi-manager plan is a capital-protected mini or maxi Isa linked to a basket of four funds - Schroder UK mid 250, Fidelity special situations, Invesco Perpetual corporate bond and Norwich property trust. Investors will get 100 per cent of the average growth in these funds if they choose 100 per cent capital protection. Alternatively, they can protect 80 per cent of their capital to get 200 per cent of the average growth in the funds. Looking at ...

  • Julian Gibbs

    17 Apr 2003

    Nvesta has come up with three top-class products, two giving high growth potential with very low risk and an income product offering 9 per cent a year with a little more risk. The first product, the Quad tracker plan, gives four times the rise in the FTSE 100 over six years, subject to a maximum return of 80 per cent. This is equivalent to 10.3 per cent a year, much higher than most investment analysts are forecasting. The second plan, the Supertracker 30 plan, gives ...

  • Just 10% say menu-based system will see shift to fees

    17 Apr 2003

    Only 10 per cent of IFAs believe the adoption of the menu-based system for the remuneration of advisers will signal a definitive move towards consumers opting to pay fees. A survey of more than 200 IFAs carried out by George Street Research for Money Marketing reveals that 55 per cent of advisers think the menu will make no difference to the number of clients paying fees while 30 per cent believe that it will have an impact on the market. Seventy-one per cent of respondents ...

  • Just the ticket

    17 Apr 2003

    Darwin's theory that living things must adapt to survive has never been more pertinent to our industry. Product providers, consumers and the advice process need to evolve. Dramatic stockmarket falls over the last three years have caused palpitations in generally cautious investors. Nerves have been further frayed by all the bad news that has come out of the financial services sector and the war in Iraq. At unpredictable times like these, investors become more cautious, ...

  • Kenmir claims PI crisis will force out 'bad IFAs'

    17 Apr 2003

    The professional indemnity crisis will force "bad IFAs" to fold because they cannot get cover, making it easier for "good IFAs" to find affordable cover, according to FSA head of investment firms David Kenmir. He says in some ways this is a good thing because it will leave a stronger IFA sector which will increase confidence in the market as whole. Kenmir is keen to stress that his comments do not mean the FSA has changed its stance on the PI market, saying he is still ...

  • L&H fixes for two years at 3.99%

    17 Apr 2003

    Leeds & Holbeck Building Society is offering a two-year 3.99 per cent fixed-rate mortgage designed for the intermediary channel. It is available up to 90 per cent loan to value and offers a free valuation.

  • Law Soc rejects trust regulation

    17 Apr 2003

    Bringing investment trust shares under regulated product listings would fail to improve the way they are brought to market, according to the Law Society. In its response to the FSA's consultation paper on proposed listing rules, it says detailed regulation governing investment powers, borrowings and derivative trading would negate trusts' flexible structure. Instead, it believes controls should be placed on the marketing and promotion of shares in investment companies.

  • Life office tax move could hit baggers

    17 Apr 2003

    A move by the Chancellor to close tax loopholes on life office taxation could make it harder for carpetbaggers to justify demutualisation. Mutuals have previously boosted the level of surplus assets by using future profits to increase demutualisation payouts. But the changes announced in the Budget will make all increases in surplus assets generated by including future profits subject to tax. The move will reduce the amount of demutualisation windfalls and is likely to ...

  • Liverpool Vic helps children stay safe

    17 Apr 2003

    Liverpool Victoria has helped to develop an educational website which teaches children about home safety. The interactive game has been created in partnership with charity Streetwise and approved by the Royal Society for the Prevention of Accidents. Streetwise estimates that 4,000 people die as a result of domestic accidents each year. Around 2.8 million people are injured, including one million children. The game is based on a simulation of a life-sized house ...

  • Living like a King

    17 Apr 2003

    Apologies to Standard Life group actuarial director Bob King after the Diary's cartoonist depicted him recentlyas a cigar-smoking, Champagne-swilling, caviar-eating executive asking for a handout from Aviva group chief executive Richard Harvey. Nothing could be further from the truth, says Bob. Apparently, the two top life company executives used to work together in Wellington, New Zealand and King has followed his former colleague's earnings with interest since their return ...

  • Menu to suit all tastes

    17 Apr 2003

    The menu-based protection package is one of the financial services industry's major success stories of the last few years. It is sometimes difficult to believe that it first appeared in the UK as recently as 1996. The convenience factor is a major plus for clients. There is just one set of documentation to maintain instead of several batches of paperwork from a variety of providers. A single direct debit means that it should be much easier to keep track of regular ...

  • MGM Assurance - Growth Assured Bond

    22 Apr 2003

    Tuesday, 22 April 2003 Type: Guaranteed equity bondAim: Growth linked to the performance of the FTSE 100 indexMinimum-maximum investment: £7,500-£500,000Term: Five years six monthsGuarantee: Original capital returned in full regardless of performance in the indexReturn: Between 10% and 45% growth at end of termClosing date: June 10, 2003 Commission: Initial 3%Tel: 01903 836000

  • Midshires backs college drive to cut skill shortage

    17 Apr 2003

    Birmingham Midshires is sponsoring a local college's drive to address the national skills shortage. Dudley College in the West Midlands is holding a skills sampling day twice a week aimed at school pupils from the Black Country and surrounding area. Young people aged up to 16 will be shown basic construction and plumbing skills and given projects to complete, such as building a wall. Research on the skills shortage by the Institute of Directors last July showed ...

  • Millfield SMPI warning

    17 Apr 2003

    Statutory money-purchase illustrations are likely to overstate the level of the income their funds will generate, warns Millfield pension specialist Graham Duckett. He says a combination of over-ambitious equity returns and falling annuity rates means income projections in the new pension benefit statements now going out to the public will already be out of date. Duckett warns that projected returns of 4.5 per cent a year are unrealistic, particularly for those approaching retirement ...

  • Morley looks for hot property

    17 Apr 2003

    MORLEY FUND MANAGEMENT MORLEY HIGH INCOME PROPERTY FUND Type: Unit trust Aim: Growth by investing in direct property, property related corporate bonds and cash Minimum investment: Lump sum £10,000 Investment split: Direct property 75%, property related corporate bonds 20%, cash 5% Isa link: No Pep transfers: No Charges: Initial 5%, annual 1.5% Commission: Initial 3% Tel: 0800 5874561 The ...

  • Mutiny on the bounty

    17 Apr 2003

    You may recall that in the article before last, I dealt with the assessment of capital in determining an individual's contribution to care home costs. I was then distracted by reports of an upswing in Inland Revenue action against husband and wife companies, where both are shareholders and receive dividends. So as not to disrupt the flow again, I will finish my review of this news and then return to the care fees issue. OK? Most commentators on this attack on spousal dividends ...

  • NDF Administration - Home Protect

    17 Apr 2003

    Thursday, April 17, 2003 Type: Cafeteria-style protection policy covering critical illness cover, term assurance, mortgage payment protection insuranceCRITICAL ILLNESSMinimum premium/cover: £2/no minimumMaximum cover: No maximumIllnesses covered: Angioplasty, aorta graft surgery, aplastic anaemia, bacterial meningitis, benign brain tumour, blindness, cancer, coma, coronary artery bypass surgery, deafness, degenerative organic brain disease, ...

  • Now Davies says the price cap doesn't fit

    17 Apr 2003

    The Treasury's proposed suite of Sandler products has suffered a significant setback after receiving harsh criticism from the unlikely source of the FSA. Last week, outgoing FSA chairman Howard Davies weighed in to the debate over price caps by publicly commenting that he does not personally believe in them and has seen no evidence from other industries they benefit consumers. At the same ABI conference in London, FSA director of conduct of business standards Michael ...

  • Now US must tackle problems at home

    17 Apr 2003

    Despite the war in Iraq drawing to a close, the prospects of an upturn in the US economy are no better than before hostilities began. Domestically, the US is facing the same problems as before the conflict, as well as some new difficulties. One of the fundamental issues is the slide in earnings' growth. Before the war, growth was widely predicted to hit 10 per cent by 2004. But many fund managers doubt it will achieve half that level, with the latest figures suggesting a more ...

  • Offshore help for IFAs

    17 Apr 2003

    Offshore life office marketing managers have set up a forum aimed at promoting the offshore market to IFAs. The offshore marketing forum has been established in a bid to raise the profile of the market and educate IFAs about offshore investment opportunities such as inheritance tax planning. It is the brainchild of Scottish Equitable International product marketing manager Steve Whalley, who has invited 14 rival life companies to join the discussion group. Other leading ...

  • OFT urged to see 'monopolistic nature' of market

    17 Apr 2003

    The LIA and Aifa are urging the Office of Fair Trading to recognise the "monopolistic nature" of the IFA professional indemnity market and take action to address these competition concerns. The trade bodies say it is essential as part of its review of employer liability insurance that the OFT considers the crisis in the IFA PI market. The LIA says the OFT should refer the matter to the Competition Commission which can intervene in the market. The OFT is expected to publish ...

  • Opra offers guides for new pension scheme trustees

    17 Apr 2003

    The Occupational Pensions Regulatory Authority is launching a nw range of leaflets that give scheme trustees information about their duties. The leaflets are designed as a starting point for trustees who need to learn their obligations under the Pensions Act 1995. Opra also has more detailed guidance publications to extend trustees' knowledge. The leaflets give details of responsibilities such as how to keep members informed, appointing professional advisers and changing ...

  • Out of context

    17 Apr 2003

    •"I am half-Scottish and have a Scottish dog." - Skandia head of product marketing Peter Jordan on moving to Edinburgh to work for Scottish Widows. •"No, I think that might be over-ramping the story." - Former MM news reporter James Moore says something no one ever thought he would say. •"It depends on how deep you want to penetrate." - Aegon director of corporate development Laurie Edmans on adjusting the cap. •"I must congratulate the ABI ...

  • OUTSIDE EDGE

    17 Apr 2003

    When gauging the question if investor sentiment has changed forever, I received a short-term answer when I attended a Budget presentation lunch event last week. Those of us around the table introduced ourselves and one executive blurted out "I hope you are not going to sell me a pension" to laughter. I was hardly going to try and entice him into an Isa either, judging that this was a good time to look at the menu. Much damage has been done to investor sentiment by the disastrous ...

  • Platinum shines in all conditions

    16 Apr 2003

    Platinum Capital Management has established the Platinum all weather fund which aims to make a profit for investors by exploring price differences between the stocks and options within the same companies. As the name suggests, this hedge fund has the ability to perform well regardless of stockmarket conditions. It has a target return of between 10 per cent and 14 per cent a year and is available in US dollars and euros. It is available to investors ...

  • Platinum shines in all weather

    16 Apr 2003

    Platinum Capital Management has established the Platinum all weather fund which aims to make a profit for investors by exploring price differences between the stocks and options within the same companies.As the name suggests, this hedge fund has the ability to perform well regardless of stockmarket conditions. It has a target return of between 10 per cent and 14 per cent a year and is available in US dollars and euros. It is available to investors with a minimum investment of £100,000 ...

  • Posh gives club a push

    17 Apr 2003

    Peterborough Football Club supporters boosted its youth training scheme by more than £110,000 last year by saving in Norwich and Peterborough Building Society's Posh account. The affinity account pays the club a cash bonus equivalent to 1 per cent of the average total balance held in the accounts each year. In four years, £347,694 has been generated for the club. The account also offers benefits such as a 5 per cent discount on season tickets and discounts ...

  • Premier Fund Managers - FTSE 100 Growth Plan

    18 Apr 2003

    Friday, April 18 2003 Type: Capital protected BondAim: Growth linked to the performance of the FTSE 100 indexMinimum-maximum investment: £2,000-£1mTerm: Six yearsGuarantee: Original capital returned in full providing index does not fall by more than 50% and returns to at least its initial levelReturn: 8% at the end of year one if the index is at or above its initial level, 16% at the end of year two if the index is at or above ...

  • Premier's plan targets 8% annual growth rate

    17 Apr 2003

    Premier Fund Managers is launching the eighth edition of its Premier FTSE 100 growth plan which aims to provide investors with annual growth of up to 8 per cent even without any growth in the FTSE 100 stockmarket index. It is designed as a six-year investment. However, the plan can mature on its annual anniversary in any of the six years, depending on the performance of the index in that year. The plan will mature at the end of the first year and pay out 100 per cent ...

  • Product matters

    17 Apr 2003

    The geared upside phenomenon keeps escalating and this time, Nvesta, formally known as Eurolife, has launched two six-year tracker plans. The first, the quad tracker plan, offers four times the upside of the FTSE 100 subject to a maximum of 80 per cent while the second, the super tracker 30, is offering a return of 100 per cent of any rise in the FTSE with no maximum but a minimum return of 30 per cent. The quad tracker is a simple geared upside product with some downside protection. ...

  • Provenio venture aims to link IFAs with accountants

    17 Apr 2003

    IFA Provenio Financial Planning is teaming up with accountancy services pro-vider Swat to launch Swat Financial Planning, an appointed representative partnership aimed at providing IFA services to accountants. The joint venture is designed to provide Swat's 150 member firms with access to an in-house IFA but without the compliance responsibilities. Bristol-based Provenio specialises in working alongside professional introducers and has six RIs. It hopes to expand to ...

  • Remortgages rise amid loan lull

    17 Apr 2003

    Advisers are reporting a 14 per cent fall in new mortgage business for the first quarter of this year, according to the Paragon Mortgages financial adviser confidence tracker index survey. The survey reveals that new mortgage introductions fell by 14 per cent to 26.1 per adviser introductions from a record 30.2 in the final quarter of 2002. But confidence remains steady, with introducers expecting average business to grow by 5.7 per cent in the second quarter compared ...

  • Replanting a cash crop

    17 Apr 2003

    I have built up considerable amounts of cash while waiting for markets to improve. I know I should move out of cash but where can I get a real return while markets are unpredictable? The main purpose of investment planning is to create financial independence. This is when you own the properties in which you live and have guaranteed income after tax that is greater than your budgeted expenditure. It is important that your assets are invested in a tax-efficient manner in ...

  • Schroders says Brown is overly confident on growth

    17 Apr 2003

    Schroders says Chancellor Gordon Brown's seventh Budget contained few surprises for the wider economy other than false optimism for growth in 2004 and 2005. UK economist Stuart Block says the revised growth forecast for this year down from 2.5-3 per cent to 2-2.5 per cent is generally good for the investment sector. But he fears the Chancellor is being overly confident by refusing to change his prediction for growth in 2004 and 2005 of 3-3.5 per cent. Block ...

  • Service errors

    17 Apr 2003

    One of the inevitable consequences of writing a regular column like this is that lots of people approach you with their ideas on how to move forward with industry e-commerce. I try to filter these and concentrate on the good ones. However, every once in a while I am approached on something where my reaction is similar to John McEnroe disputing a line call. "You cannot be serious!" The latest example of this was when I was invited to look at a new service from Key Software Solutions which ...

  • SFS dropping Inter-Alliance from panel

    17 Apr 2003

    Lawyers' service provider Solicitors Financial Services is ending its contract with national IFA Inter-Alliance. It is refusing to elaborate on why it is dropping the firm although Inter-Alliance says it is because they failed to reach a deal on fees. SFS acts as an IFA referral services for its 1,000 members, putting them in touch with its panel of Inter-Alliance, Towry Law and Barclays bank subsidiary Sedgwick Financial Services. SFS served notice on Inter-Alliance ...

  • Simon Holt

    17 Apr 2003

    Skipton Financial Services managing director Simon Holt has just invested in a place abroad and would like to get the chance to use it. Resting on the Costa del Sol near Gibraltar, it is an apartment that, when finished, will be the perfect Spanish hideaway for him to escape from the busy series of acquisitions he has been involved in recently. But it is not as if he needs to escape the hectic life of city, with SFS's head offices pleasantly located in the quiet Yorkshire market ...

  • So near yet so Scar?

    17 Apr 2003

    This has got to stop. Once you get that face in your head, you can't get rid of it. Diary readers seem to be seeing Money Marketing contributor Tony Wickenden wherever they look. The latest in the "Looks like Tony Wickenden" series in the pre-Robert Pires facial hair stage is this one sent in by Mike Richards of Capital City Media. Richards reports "a disturbing similarity between Al Pacino, your tax expert, and Tony Wickenden, star of several Godfather films". To ...

  • Standard boosts GPP fund links

    17 Apr 2003

    Standard Life is planning to increase the number of external fund links for its executive pension plans and group personal pensions from 12 to 30. It wants to extend its range in response to growing demand from IFAs for greater fund choice. It hopes to add the links, which will be offered alongside its 16 in-house funds, by the end of the year. The charges on the external links range from 0.3 per cent to 1 per cent. Standard is still considering if and how many ...

  • Standard Life endowments

    17 Apr 2003

    I have been caught out by Standard Life with their projections of maturity values for mortgage endowments. I did not realise, until a helpful member of staff gave me the tip, that Standard Life procedure is to: •Calculate the policy cash surrender value, •Then apply a market value adjustment •And the resulting balance is then driven forward at projection rates 4, 6 and 8 per cent. The result is dreadful - unqualified low maturity values. In ...

  • Survey shows just 10% of IFAs plan multi-ties

    17 Apr 2003

    Only 10 per cent of IFAs plan to multi-tie some or all of their business while 68 per cent say they plan no changes after depolarisation at the end of the year, according to George Street Research. The survey, conducted for Money Marketing, confirms that the majority of IFAs do not plan to give up independence. The findings are similar to those revealed in the annual Money Marketing and One Account State of the IFA Nation survey in February which found that 77 per cent ...

  • Talkback

    17 Apr 2003

    "No, I have clients who are now deliberately setting aside money to save for the stamp duty they will have to pay when they move house every five years or so. This is a huge one-hit payment that needs to be changed to help savers." Henry Simpson,Simpson Financial Planning "No not at all. This has been a nonevent that has helped no-one. A number of my clients believed that the child trust fund would be an annual payment they could use as a nest egg towards fees, not a one-off ...

  • Tax to rise on life bonds

    17 Apr 2003

    Higher-rate taxpayers will face a tax rise of 2 per cent on encashment of life investment products next year after changes to the taxation of life investment bonds in last week's Budget. The underlying life fund will be taxed at 20 per cent rather than 22 per cent, leaving the higher-rate taxpayers facing tax bills of 20 per cent, the difference between the underlying rate and the 40 per cent higher rate, instead of 18 per cent as was previously the case on maturity.

  • Tenet trio of new services for IFAs

    17 Apr 2003

    Tenet Group service provider IFA Professional Services is launching three new service levels for advisers. The three new packages - principal, tailored and full - are an expansion on the core T&C, research and PI offerings. Advisers can get marketing and business development information, a professional development programme, business consultancy information, a non-regulated framework and the Tenet reward scheme.

  • The acid test for tax simplification

    17 Apr 2003

    Now the initial consultation phase (Simplifying the Taxation of Pensions: Increasing Choice and Flexibility for All) is over, it will be interesting to see if simplification is actually achieved. There is one simple acid test for this. There are numerous practice notes for pensions, primarily they are: •Personal Pension Scheme Guidance Notes IR 76 •Occupational Pension Schemes Practice Notes IR 12 •Very many updates published by the Inland Revenue. These ...

  • The chips are down

    17 Apr 2003

    Like a lot of investment, traded endowment policies look simple on the surface. Either as a tax-efficient savings vehicle or a low-risk investment, Teps are useful for many medium to long-term needs, including retirement. But they may not be as simple and efficient as they seem. Towry Law product research manager Simon Farrant thinks buying Teps and Tep funds is like playing poker with professional bluffers. He says: "At best, the buyer is up against two other ...

  • The Marketplace offers a stepped discount at 3.99%

    17 Apr 2003

    The Marketplace at Bradford & Bingley is offering a two-year stepped discount mortgage with an initial rate of 3.99 per cent. The deal is funded by Woolwich and is aimed at remortgagers, with a discount of 1.8 per cent in the first year off the current variable rate of 5.79 per cent. The discount reduces to 1.2 per cent in the second year, giving a current rate of 4.59 per cent. The loan is available up to 90 per cent loan to value and is free from mortgage guarantee ...

  • The miles file

    17 Apr 2003

    Rarely has a Chancellor taken so long to say so little. Even journalists, who are frequently asked to spin 1,000 words out of a single fact, were impressed by Gordon Brown's ability to take an hour to say nothing. So thin was the content of last week's Budget that the child trust fund - an initiative that was first announced two years ago - hogged the headlines. Adding insult to injury, the Treasury provided fewer details this time around. The savings industry, ...

  • The usual suspects

    17 Apr 2003

    Remakes of classics are generally disappointing and the news that J-Lo and Ben Affleck are to remake Casablanca is unlikely to change things. In a similar vein, I have to question whether remaking with-profits is also going to deliver similar regrets. The key element of the appeal of with-profits was smoothing or the partial insulation of the investor from volatility in the investment markets. Continuing to use market value adjusters at will must make this smoothing a ...

  • Thunderdome Take the challenge

    17 Apr 2003

    Win an exclusive day for you and seven of your friends at the Johnny Herbert Rockingham Experience to celebrate GE Life's first anniversary. It is a year since GE Life and National Mutual joined forces to form an enhanced and enlarged GE Life group of companies. To celebrate its first anniversary, GE Life has teamed up with the Johnny Herbert Rockingham Experience to offer one lucky race enthusiast and seven team-mates the chance to compete in the Thunderdome challenge. You ...

  • To transfer or not to transfer?

    17 Apr 2003

    Just when you thought you had pinned down all the issues for transfer of preserved benefits from a defined benefit scheme along came a couple more - how strong is the employer's covenant, and how might the cash equivalent transfer value (CETV) basis change over the next few years? Until quite recently, a DB benefit promise was always taken at face value but now everyone is waking up to the difference between a promise and a guarantee. Companies such as ASW have gone ...

  • Turn the technology key

    17 Apr 2003

    Much has been written about the Pensions Green Paper since it was unveiled last December. There are a few key Government objectives which deserve a quick summary. First, the Government is striving to offer people better financial choices so they can plan for the future. The second involves reaffirming the role of employers in helping people to save for retirement. Its third aim is to create simpler and more flexible pensions. One specific area of simplification is likely to be ...

  • Two-thirds of IFAs support captive PI plan

    17 Apr 2003

    Two-thirds of IFAs think that the creation of a captive insurer offering professional indemnity insurance solely to IFAs would make it easier to get compliant cover, according to George Street Research. Its monthly Omnifa survey reveals that 67 per cent of IFAs think that if such a scheme was established, it would definitely or probably make it easier to find cover. Seventeen per cent believe it will make no difference to the PI crisis while 15 per cent say they do not ...

  • UCB sets out steps to buy-to-let success

    17 Apr 2003

    Nationwide's specialist lender UCB Home Loans is publishing a free guide for budding landlords who want to take their first steps into the buy-to-let market. UCB says buy to let is a rapidly increasing market and spring has become a traditional time to seek out new properties. The guide, Buying to Let - Know The Facts, details what UCB says are the top 10 tips that landlords should consider when investing in property. Its number one tip is to choose the right ...

  • We don't need any more simple products, says Smee

    17 Apr 2003

    The Treasury's creation of a range of simple products is unnecessary because products satisfying the needs identified by Ron Sandler are already offered by National Savings & Investments, according to Aifa director general Paul Smee. Smee said the Government's exercise was futile because products already exist that are suitable for low to middle-earners who are not saving. Speaking at a Sandler seminar at the ABI's annual conference in London last week, Smee ...

  • What are the long term aims?

    17 Apr 2003

    Is it the first step to reducing volatility in UK economic cycles, a waste of taxpayers' money on an academic exercise to prove something we already know or a project set up to give Gordon Brown another reason not to join the euro? These are just some of the reason that IFAs and the mortgage industry have put forward as to why the Chancellor has announced a review looking at the causes of the UK's antipathy to long-term fixed-rate mortgages? The overwhelming reaction ...

  • Who profits from with-profits?

    17 Apr 2003

    Mr Jones invests £7,500 in a with-profits bond. Five years later, in 2003, it has a face value of £10,000 but an encashment value of only £7,500 - due to a 25 per cent MVR currently prevailing. This he can live with, for a while at least, as he was warned at the outset of MVRs. When the MVR is lifted, the encashment value of his investment should return to its face value. Mr Jones is contemplating investing a further £7,500. He believes this could ...

  • Widows launches directors' business development pack

    22 Apr 2003

    Scottish Widows is launching a new business pack to support IFAs selling executive pension policies.The pack draws out issues from the pensions Green Paper which are likely to affect the directors' market.Scottish Widows marketing manager Ann Flynn says: "The director's market may see some changes from 2004. We are encouraging any IFA who has executive clients to review current arrangements and examine what planning and provision can be done now."

  • Yorkshire BS targets teenagers with savings account

    22 Apr 2003

    Yorkshire Building Society is targeting the teenage market with the launch of a savings account paying 3.89 per cent AER.

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