Money Marketing
29 May 2002

  • 'Borrowers returning to building societies for best mortgage deals'

    30 May 2002

    Building societies reached their highest mortgage lending total for 13 months in April. Figures from the Building Societies' Association show societies' lending at £2.673bn in April up from £2.67bn in March and £1.9bn in April 2001. BSA figures for April reveal net advances rose to £788m from £682m the previous month and £628m last April. But approvals, loans agreed but not yet made, decreased to £3.3bn from £3.4bn in March ...

  • 'IFA management and systems are a big joke'

    30 May 2002

    Product providers see IFAs as bad managers with poorly organised businesses and are more interested in advisers than systems, according to new research. The survey, by Camp Chipperfield Hill Murray, foresees a greatly reduced independent sector dominated by new distributor companies owned by providers, draining quality advisers from existing channels. The qualitative research, based on indepth interviews with high-level provider executives and IFAs, revealed that providers are ...

  • 'Name and shame' on endowments

    30 May 2002

    The Consumers' Association is calling on the FSA to create league tables to name and shame companies whose endowment policies are likely to suffer shortfalls. It also wants reform of the financial advice sector to be put on hold until the FSA has addressed the issue of commission-driven sales. The consumer pressure group has written to FSA chairman Howard Davies asking the regulator to highlight the industry's worst performers on endowment performance by publishing a table ...

  • 15 IFAs axed as IFG centralises

    30 May 2002

    IFG Group, which has its headquarters in Dublin, is cutting around 15 of its rural UK IFAs because their remote offices do not fit within the group's plans for fee-based advice. Its UK IFA arm, IFG Life and Pensions, has reorganised around six flagship offices with 16 team leaders managing advisers working on a fee-only basis. IFG Life and Pensions has been expanding through the acquisition of small firms across the country, particularly in East Anglia. But the firm has ...

  • 80% see income fall after retiring

    30 May 2002

    People are experiencing a huge drop in income when they retire, according to Prudential. Its research found that around 80 per cent of pensioners see a drop in their monthly income averaging £347 after leaving full-time employment. A third of retired people are struggling to survive on less than £10,000 a year. Nearly one in five pensioners questioned by Prudential said they had not expected their income to fall after retiring from work. Women are hardest hit, living ...

  • A new role for FSA as it becomes a critic of Government's policy

    30 May 2002

    The FSA has openly criticised Government policy for the first time, warning that the pension credit could confuse savers, a move seen by some as a sign of the FSA coming of age. With last week's publication of the paper, Financing the Future: Mind the Gap, the FSA has entered the debate over Government pension policy. Until now, it has been content to stay on the sidelines and let others engage the Government. What has this brought about this abrupt change of attitude? One ...

  • ABN Amro adrift as fund duo jump ship

    30 May 2002

    After suffering the shock of its two star fund managers resigning last month, ABN Amro has now been hit by their decision to move to Framlington with immediate effect. Having previously been upbeat about George Luckraft and Nigel Thomas' departure - as both had stated an intention to see out the remaining 12 mon-ths of their contracts - ABN has now had the rug pulled from under its feet. With no time to placate nervous investors with suitable heavy-hitting replacements, it is ...

  • ABN and Framlington in legal wrangle over fund managers

    30 May 2002

    ABN Amro and Framlington have become embroiled in a bitter legal wrangle over the departure of star fund managers George Luckraft and Nigel Thomas. The legal dispute arose after former ABN stars Luck-raft and Thomas walked out last week, claiming that actions taken by ABN since their resignations had caused an irreconcilable breakdown in their relationship and made their positions untenable. With speculation mounting that both would be running funds for Framlington within days, ...

  • AITC celebrates golden years

    30 May 2002

    The 45 investment trusts that have been in existence from the time of the Queen's coronation in 1952 until today are still providing excellent value for investors, according to the Association of Investment Trust Companies. Research by the AITC to celebrate the Queen's Golden Jubilee focused on the performance of trusts such as those from Foreign & Colonial, Scottish American, JP Morgan Fleming and Henderson. It canvassed the views of top IFAs on which fund managers have ...

  • Anna Bradley

    30 May 2002

    With last week's publication of its paper on the future of financial advice, the National Consumer Council announced its re-entry into the debate about an industry that it has left alone for the last three years. Leading the charge back into financial services is director Anna Bradley, who is looking to re-establish the NCC as a major contributor to future thinking about savings policy. The NCC's first foray has not been met with much applause from IFAs, as the paper welcomed ...

  • April Isa sales top £1bn in huge last-gasp rush

    30 May 2002

    A massive last-minute wave of cash took Isa investment over £1bn in April. IMA figures show that the end of tax year rush boosted net sales to around £1.15bn - the highest level for 12 months - from £839m in March but failed to match the £1.39bn fig- ure for April 2001. Around half of last mon-th's sales came in the scramble to meet the tax deadline, with net sales between April 1 and April 5 hitting £563m. It meant that Isa sales accounted for ...

  • As and means

    30 May 2002

    Mr and Mrs A have recently sold their business and are retiring at age 65 and 63 respectively. They have a total of £180,000 in cash and do not wish to take much risk. Mr A has two paid-up personal pensions with Lincoln and Scottish Widows, both offering guaranteed annuity rates although the Scottish Widows plan is only guaranteed at age 75 and on a single-life basis only. His state pension is £10,118 a year. Mrs A has no pensions other than £2,425 a year from the state. Their

  • Axa Isle of Man - Defensive Bond

    29 May 2002

    Wednesday, May 29, 2002 Type: Unit-linked bond Aim: Income and growth by investing in the Liberty Ermitage asset selection fund Minimum investment: Lump sum £25,000 Place of registration: Isle of Man Investment split: 100% in the Liberty Ermitage asset selection fund Isa link: No Charges: Initial 0.43% a quarter for first four years, annual £25,000-£49,999 0.25%, £50,000-£99,999 0.2%, £100,000-£

  • B&W scales down London focus

    30 May 2002

    Bristol & West is cutting back its focus on buy-to-let lending in London, where it says investment yields are falling, to inc-rease its presence in other areas around the UK. The firm says that from an investors' point of view, it is becoming more difficult to justify buy-to-let borrowing in London, where returns have dropped to about 4.5-5 per cent compared with 7 per cent in the South-west and 12 per cent in Manchester. B&W says the London market is in danger of overheating, ...

  • Baxter Fensham to franchise fee-based model to advisers

    30 May 2002

    IFA Baxter Fensham is planning to franchise its fee-based model to firms wanting to make the transition from commission to fees. From September, the firm will offer a franchise package for training and managing the move to fees. Firms will pay an up-front charge and an annual fee for the franchise and are likely to be offered equity shares in the group franchise business to create a national IFA. Franchisees will benefit from deals on time recording software. Baxter Fensham, ...

  • BBB to buy firms in multi-ties move

    30 May 2002

    Berkeley Berry Birch is launching an acquisition vehicle focused on buying IFA firms wanting to multi-tie after depolarisation. Berry Birch & Noble Advisers has taken on a team to recruit regional IFA practices with annual turnovers of £1m-£5m with a view to becoming a national multi-channel brand. It comes as BBB is being launched with a new corporate logo covering the group. BBB, formed in January when Berkeley Independent Advisers reversed into Berry Birch and ...

  • Boost for Winterthur Sipp

    30 May 2002

    Winterthur Life is hailing the successful launch of its universal Sipp as a demonstration of how well-integrated marketing campaigns can work. The campaign, created by Teamspirit, targeted IFAs through the trade press, direct marketing, the internet and PR initiatives. Winterthur says the campaign had a response rate of 15 per cent and led to a considerable number of sales leads. Teamspirit, whose clients include Prudential, Bank of Scotland, Schroders, Edinburgh Fund Managers ...

  • CA wants lower-tier advisers to refer clients to IFAs

    30 May 2002

    The Consumers' Association is to call for three categories of lower-tier financial advisers who refer consumers to IFAs if their needs extend beyond the safe haven products they are allowed to offer. The watchdog is this week publishing a paper which will call for lower-tier financial advice to be available from local government offices or Citizens' Advice Bureaux, employers or charities as well as the more conventional sources of IFA firms and high-street providers. Whenever ...

  • Call for action to fill empty houses

    30 May 2002

    The Halifax is urging the Government to end council tax rebates for empty properties. Research by the bank found that 90 per cent of people want the Government to act to reduce the number of empty homes, which stands at around 750,000. Concerns focus more on the social problems relating to empty houses rather than the effect a derelict property has on the value of nearby homes. Halifax says 76 per cent of people believe that empty homes should be used to house the homeless. A ...

  • Canary spies came in from Cold War, says Treasury official

    30 May 2002

    Industry speculation over the FSA's attitude to polarisation reform is akin to Cold War experts' attempts to interpret the mood of the Soviet leadership, says a senior Treasury official. Treasury savings and investment products team member Keith Davis damped down talk of a U-turn on CP121 and likened FSA-watchers to the Kremlinologists of the 1960s at a conference in London last week. Speaking at the conference, Depolarisation: Changing Business Relationships, Davis said ...

  • Cazenove makes inroads into IFA market

    31 May 2002

    Cazenove Investment Fund Management is making inroads into the IFA market with the Cazenove universal investment bond, established in conjunction with AIG Life.

  • Cemap co-ordinates

    30 May 2002

    As good as it was, the birthday wine that toasted the passing of another year could only be a temporary diversion to the envelope containing the Cemap syllabus that lay unopened in my office. However, as the saying goes, a journey of 1,000 miles starts with a single step and it was time to open my up to now discarded birthday present - a big black ringbinder announcing itself as the syllabus for the Certificate in Mortgage Advice and Practice. Using my best time management and ...

  • Correspondent's week

    30 May 2002

    It is not every week you launch a new life company and anyone who thinks it is easy should see the blood, sweat and tears (almost) shed by the Selestia team. This week is a big one for us as we are indeed launching our life company and it has been a long and arduous process. So the week ahead promises a mixture of excitement tinged with worry that everything will fit together on the day. Children, of course, are oblivious to all this and Monday starts like most mor-nings as our ...

  • Crash crunch

    30 May 2002

    Do you think that a housing market crash is a significant risk, especially in London, as economist, and former advi-ser to Kenneth Clarke, Roger Bootle warned at the Building Societies Association conference? Stuart Glendinning: It is a pretty strange situation, when you could be £500 better off for simply having walked to your local newsagents and back to buy a newspaper, simply because house price inflation is so rampant. The situation at present cannot be healthy in the ...

  • Critical and income insurance sales hit record year

    30 May 2002

    Individual critical-illness and individual income protection sales had a bumper year in 2001, surpassing previous sales records, according to the latest figures from reinsurer Swiss Re. In its 2002 edition of HealthWatch, Swiss Re shows that sales of individual critical-illness cover increased by 12 per cent to 872,184 from 780,271 in 2000 and individual income-protection sales increased by 11 per cent to 204,379 from 184,780. The report says 46 per cent or 402,100 of critical-illness ...

  • Cyber system stops IFAs having to hang on the telephone

    30 May 2002

    IFAs could soon be able to avoid hanging on the telephone for hours waiting for product providers with Adviser-support.com, a new relationship management system from Cyberspace Group Services. The service will allow advisers to lodge queries with providers 24 hours a day and have the query automatically routed to the correct department. Unlike email queries on providers' extranets, the system enables advisers to track when queries were lodged and escalate the urgency of requests ...

  • Darling leaves DWP, replaces Byers at transport

    29 May 2002

    Secretary of State for Work and Pensions Alistair Darling has been named as the replacement for disgraced Transport Secretary Stephen Byers, who resigned yesterday.

  • Directors to carry can for with-profits

    30 May 2002

    Life office board directors running with-profits funds will be answerable for performance and consumers will get more information following the FSA's with-profits review. The review has divided the industry over reforms which some call a disappointment while others welcome them. The role of the appointed actuary will be one of discretion only when setting bonus rates and actuarial assumptions, with directors taking responsibility for how the fund operates. Preand post-sale ...

  • EFM widens portfolio fund choice

    30 May 2002

    Edinburgh Fund Managers is increasing the fund choice available through its Classic Portfolio Service with the addition of its monthly income and fund of funds portfolios. The addition of the new funds to the CPS, which EFM describes as a discretionary-style global portfolio management service, brings the total available to four. The company says the service is aimed at investors wanting capital growth through a globally diversified portfolio within a medium-risk to low-risk environment. The ...

  • Equitable Life accuses IFAs of urging policyholders to quit

    30 May 2002

    Equitable Life has attacked IFAs and the media for adding to its woes by encouraging policyholders to leave the troubled life office in droves. Speaking at Equitable's annual general meeting in London this week, chief finance and investment officer Charles Bellringer said the interests of financial advisers do not tally with those of the society. He also accused the media of rehashing stories about Equitable's solvency and insisted that it has always been solvent. Bellringer ...

  • Exam retests every two years and alphabet soup to be axed

    30 May 2002

    IFAs will face exam retests every two years to retain authorisation, with retakes for those who do not pass the exam on their first attempt, when the FSA exam review findings are implemented next year. In its feedback to industry responses to DP9, the examination review, the regulator also confirmed it still intends to scrap the so-called alphabet soup of designatory letters, replacing them with a single standard recognisable to customers. There was nothing new in the paper other ...

  • Fears for tiers

    30 May 2002

    CP121 introduces the concept of a lower tier of financial advisers to provide the mass market with low-cost advice on simple products. However, we at AT Kearney question the overall commercial viability and feasibility of these proposals as they appear to fall down on three levels. First, the commission that can be earned on simple Catmarked products means that a lower-tier adviser would need to reach superhuman levels of productivity to break even. Second, providing regulated ...

  • Framlington World Cup challenge

    30 May 2002

    The final results of the Framlington World Cup Investment Challenge were announced in last week's Money Marketing but today we announce that the overall winner of the competition is Nick Pike, whose Lazy Boyz team have held on to the top spot with an overall gain of 10.92 per cent during the 12 weeks of the contest. John Bramwell's HL Reserves were second with a 10.49 per cent gain and he deserves a special commendation for pushing Pike all the way. Third was one-time leader ...

  • France accused of obstructing foreign insurers

    30 May 2002

    The European Commission is taking France to court for the second time and seeking daily penalties of £150,000 for non-compliance with EU law on the regulation of life insurance companies. The EU believes that France's actions are discriminatory and run counter to the single market by favouring France's mutuals and stopping other insurance companies from accessing its market. The Third Insurance Directives should have been implemented by December 31, 1993. France ...

  • FSA takes a new view

    30 May 2002

    The FSA has broken the habit of its not very long lifetime and criticised some aspects of Government policy, notably the pension credit, while warning about an extension of product regulation. It has also tried to foresee many problems associated with decumulation products - annuities, drawdown and equity release - although, on the drawdown issue, the FSA is still addicted to finding IFAs guilty until proven innocent. The regulator is a long way from coming of age, particularly ...

  • FTSE-linked plan will lock in growth

    30 May 2002

    Premier Fund Managers is offering a second UK income and growth plan featuring 7.5 per cent annual income or 32 per cent growth over four years. It also has the option of 0.6 per cent monthly income. The fund is available for Isa investments as well as Isa and Pep transfers. The capital return is linked to the performance of the FTSE 100 index over four years. Investors will receive the full return of their capital if the index does not fall by more than 25 per cent. Even if ...

  • Fund carousel spins on with three out and three in at Morley

    30 May 2002

    The fund manager merry-go-round continues apace, with Morley Investment Managers the latest company to be hit after losing three top managers to Clerical Medical Investment Management. Head of European equity and £20m European focus fund manager Ian McNeill, segregated mandates manager David Headland and UK head of institutional investment Ian Brown have all decamped to HBOS's fund management arm. But Morley has poached three new managers. Roth-schild head of fixed income ...

  • Geffen forms new company with £30m of Orbitex assets

    30 May 2002

    Orbitex chief investment officer Robin Geffen is setting up a new company after snapping up the UK investment contract of the Zurich-based fund manager. Neptune Investment Man-agement will launch with assets of around £30m - inc-luding one pension fund and three Oeics - transferred from Orbitex and will initially target high-net-worth IFAs and the Sipp and SSAS markets. Geffen, who has run the Orbitex funds since their inception, will become Neptune's managing director ...

  • GMAC says it is working to clear mortgage backlog

    30 May 2002

    Specialist mortgage lender GMAC-RFC has admitted it is having problems in servicing brokers, with a two-week backlog of applications in recent weeks. Brokers have complained to GMAC over delays in completing client applications and the company says it has not been able to cope with the "phenomenal volume" of demand. The firm says it has tried to keep intermediaries informed of the situation. Some of its competitors have been facing similar problems because of the booming housing ...

  • Hartnell leads Consifa drive

    30 May 2002

    IFA group Consifa has appointed Ian Hartnell from top 20 accountancy firm Smith & Williamson to head its acquisition and recruitment arm. Hartnell will become managing director and will spearhead Consifa's drive to recruit IFA firms to create a national IFA. He specialised in corporate pensions at Smith & Williamson. Consifa is in the final stages of negotiations to buy three firms with a combined turnover of £10m and a total of 22 RIs. It is looking to acquire ...

  • Home is where the burial plot is

    30 May 2002

    One of the key reasons for a possible change to the law of domicile - the subject of my most recent columns - may well be to introduce a greater degree of certainty. Of course, for most clients of financial advisers in the UK, there is no uncertainty - they will be UK-domiciled by virtue of their unchanged domicile of origin being in England, Wales, Scotland or Northern Ireland.But where there is some uncertainty, most usually for those living ...

  • Housing tax plan is 'lead balloon'

    30 May 2002

    A call by the Royal Institute of Chartered Surveyors for greater use of the tax system to control volatile house prices rather than relying on interest rates has been slammed by mortgage experts. The wide ranging initiatives, such as levying council tax on empty and second homes and reducing stamp duty in deprived areas, are some of the radical recommendations in the RICS manifesto, Housing the Nation, which was published this week. It puts forward the case for European-style mortgages ...

  • Huge cost of lower-tier advice

    30 May 2002

    Lower-tier advisers would have to reach "super-human" levels of productivity, achieving £480,000 in annual sales for the first three years just to break even, according to global consultancy AT Kearney. Writing in this week's Money Marketing, AT Kearney principal Gerard Sharkey says it would be nearly impossible for the FSA's proposals to be commercially viable because of the low commission available on the type of products such an adviser would be allowed to sell. He ...

  • IMA baffled at report of Sandler move on active funds

    30 May 2002

    Ron Sandler will recommend that the Government cracks down on the sale of actively managed funds bec-ause of the belief that they rarely outperform cheaper tracker funds, according to The Times. The paper says Sandler's review team will make the recommendation when it publishes its report, expected in mid-July, because Sandler does not believe that actively managed funds are worth their value compared with trackers. The claim comes as a surprise to the IMA, which says that in ...

  • Independent View - Tony Byrne

    30 May 2002

    Without a shadow of a doubt, today's seemingly relentless onslaught of reviews, misselling scandals, exam requirements, compliance and training and competence standards, red tape, media attacks and overall Government antipathy towards IFAs and financial advisers in general represents probably the most challenging environment ever seen for even the most resilient of IFAs. Let us list some of the current issues - the Sandler rev-iew, CP121, the Pickering review, the Inland Revenue ...

  • Inside Edge - Steve Bee

    30 May 2002

    The more prescriptive the pension annuity rules are, the less likely people are to commit substantial savings to pensions. To me, certain things are self-evident: The laws governing annuity purchase should be changed. Annuity purchase should not be regarded as a single, once in a lifetime event. There should be no requirement to take tax-free lump sums at the same time as annuities are purchased. A less prescriptive environment would increase the perceived value of annuities ...

  • Investment analysis

    30 May 2002

    The possibility of further terrorist attacks in the US and the India-Pakistan conflict over Kashmir were the focal points last week. Global markets lost nearly half the gains from the previous week as concerned investors locked in profits and the benchmark FTSE World Index lost 1.4 per cent. It was a dull week in the US with stocks ending on a negative note. Chip equipment makers were hit after broker Goldman Sachs downgraded the sector. Also weighing on sentiment was a downward revision ...

  • Investment view

    30 May 2002

    Among the many jobs I have held in the investment world is that of stock analyst. At the time, I was also a fund manager but the investment house I worked for required all charged with looking after money to contribute to the overall investment process. My sector was engineering, chosen on the premise that I had spent five years working in Birmingham. My worst call - which in some measure was also my best - was to advise against applying for Jaguar shares at their flotation. I identified ...

  • It must be love

    30 May 2002

    Britannic Asset Management is title sponsor of the ladies' international tennis championships in Eastbourne for the second time this year. The event, which takes place between June 15 and June 22, will see last year's winner Lindsay Dav-enport defend her title against a host of star names, including Anna Kournikova and Martina Navratilova. To celebrate its sponsorship, Britannic is offering Money Marketing readers the chance to win a pair of centre court tickets for Thursday, ...

  • Julian Gibbs

    30 May 2002

    Because it has spent little money on advertising, Rathbone is not well known among most IFAs but, in fact, it is one of the best-performing fund management groups. Its star fund manager, Carl Stick, runs three funds rated five-star by Micropal and has just taken over another five-star fund from departing fund manager Patrick Evershed. Incidentally, over the past year, Stick's income fund outperformed Evershed's special situations fund. While I have a high regard for Evershed, ...

  • Kelly promoted to financial secretary

    29 May 2002

    Treasury economic secretary Ruth Kelly has moved up the ministerial ladder to become financial secretary, but she will retain responsibility for retail financial services.

  • L&G helping brokers complete mortgage applications online

    30 May 2002

    Brokers using Legal & General's point-of-sale mortgage decision service are now able to complete the entire application process online. A new system, goal:technology, from Focus Solution, is designed to speed up the completion process for mortgages and related protection products. Customer information is collected and validated offline through each stage of the mortgage advice and application process. This is intended to save time and reduces errors by ensuring that only ...

  • Lenders' anger at £30k fee to join Misys panel

    30 May 2002

    Lenders are blasting Misys Lending Service, the mortgage network launched this month, for demanding an annual fee of £30,000 to become a premier lender on its panel. Specialist lender Verso says firms are being asked to pay this fee to be a premier panel member and in return they get marketing and promotional services that other "non-premier" lenders on the Misys panel do not receive. Verso believes the fee is unjustifiable, saying the network is a low-cost operation which ...

  • Lending taken to new high by record remortgaging

    30 May 2002

    Mortgage lending reached a new peak in April with gross advances totalling £16.9bn, up from £16.1bn in March and a big rise on £11.6bn in April 2001, according to the Council of Mortgage Lenders. The value of loans for house purchase fell slightly to £8.8bn in April, or 52 per cent of gross advances, from £9bn, or 56 per cent of gross advances, in March. This figure was £7.4bn last April. The number of loans for house purchase dropped to 108,000 ...

  • Loan industry split on buy-to-let regulation

    30 May 2002

    The mortgage industry is split on whether the booming buy-to-let market should be regulated by the FSA. The Treasury says investing in buy to let is a commercial transaction and should not be regulated alongside the residential mortgage market from 2004. The Council of Mortgage Lenders agrees with the Treasury but firms such as BM Solutions and Southern Pacific Mortgages believe this puts borrowers in danger. Southern Pacific director of credit Stuart Aitken says the recent ...

  • Low-risk US fund firm in UK retail move

    30 May 2002

    US asset management firm Dimensional is planning a major launch into the UK retail market in September led by former Schroders chief executive officer David Salisbury. Dimensional, which has its head office in Los Angeles, has $39bn of assets under management worldwide. It is a low-risk fund manager with 30 pooled funds covering smaller company, value stocks and fixed-income securities in the US, European, emerging and global markets. It believes IFAs will be attracted to its risk-averse ...

  • Millions 'losing sleep over money'

    30 May 2002

    Nearly half the population have not saved or invested money regularly over the past six months, a Royal London survey has found. The study of 963 people in April discovered that 44 per cent are not putting aside money regularly and 27 per cent choose to gamble their spare cash instead. Women save £60 less than men on average each month. The survey explored the findings of a recent Pension Policy Institute study which suggested that people will have to work until 72 to ...

  • Moore's code

    30 May 2002

    Regulators, politicians and consumer groups have spent the last 10 years knocking the stuffing out of the life industry and with some justification. After all, it has spent the last 20 years selling - or should that be misselling? - some decidedly shaky products which seem to have been designed for the 19th Century rather than the years leading up to the 21st Century. At the same time, the fund management community has been left largely unscathed, looking down its collective nose ...

  • Mortgageforce picks agency to draw franchisees

    30 May 2002

    Broker franchise Mort-gageforce has appointed McConnells Advertising to control its marketing strategy in a deal worth more than £200,000. The account has been opened with the Derby-based ad agency to raise Mortgageforce's image with potential franchisees and assist its current franchisees with marketing. Mortgageforce claims to be one of the most rapidly expanding franchise business in financial services. It says it already has 60 consultants around the country. The ...

  • Multi-ties will not help consumers

    30 May 2002

    The new multi-tie proposals are designed in a manner that will allow the big insurance companies to control and dictate the marketplace even more so than they currently do. For example, Legal & General must be one of the biggest providers of missold endowment policies, acting as a tied agency facility for numerous banks and building societies to sell products which - in 1984 - the Chancellor said would no longer be as financially advantageous for investors because of tax changes. Why ...

  • Nationwide profits fall by third but lending share recovers slightly

    30 May 2002

    Nationwide Building Society saw its profits plummet by £109m to £233m in the year to April 4. But it achieved a 3.1 per cent share of net residential mortgage lending, up from 0.2 per cent at the half-year but down from its 9.1 per cent share in 2001. The society attributes this growth to its fair pricing mortgage initiative progressing ahead of target. It says further evidence of growth is that current pipeline mortgage business is £3.7bn, up from £2.6bn ...

  • Neville James Portfolio Management - TEP Portfolio Service

    31 May 2002

    Friday, May 30, 2002Aim: Growth by investing in traded endowment policiesMinimum investment: Lump sum £100,000Investment split: 100% traded endowment policiesIncome facility: YesCharges: Initial 1%Commission: Subject to negotiationTel: 01243 520051

  • Neville James Tep service aims to slash IFA admin

    30 May 2002

    Traded endowment policy specialist Neville James is offering a portfolio management service in a bid to ease the admin burden on advisers and their clients. The firm says the service has been designed to make investing in Teps more straightforward. It offers four options which can be used in any combination to enable IFAs to choose the level of involvement they have in buying and monitoring policies. The admin option takes the legal work on transfers of Tep ownership out of the ...

  • Newcastle combines property growth and income

    30 May 2002

    Newcastle Building Society has established the income and growth property bond, a combination product comprising of a guaranteed growth bond and a high interest account.

  • On track online

    30 May 2002

    The role of the internet has for some time provided a forum for up to date comment, opinion and speculation about technology and the mortgage market. Are we on the verge of a technical revolution or have we simply lost our way on the information super highway? Whatever the answer, a business which chooses not to embrace the online challenge does so at its peril. But where are we heading? Surely it is a good time for some published research to help provide the answers. The Council ...

  • Open battle with Woolwich over mailings to IFA clients

    30 May 2002

    The Woolwich has been criticised for trying to poach Open Plan mortgage clients for its own IFA who were introduced to it by IFAs. Advisers claim that the bank's IFA arm Woolwich Independent Financial Advisory Service has been mailing their clients within months of them completing their loans, with a flyer saying: "Independent Finance Advice you'll feel really comfortable with." Dorset IFA Insurance & Investment Service principal Christopher Sheldrake says he has been ...

  • Outside Edge - Nick Bamford

    30 May 2002

    Why would any member of the public want to buy a pension plan? Surely, only the most financially unaware consumer fails to realise that pension plans are expensive, poor performing, complicated and touted by the most hard-nosed of salespeople who are only interested in grabbing as much commission as they can. Oh yes, and then there is this thing called an annuity. Apparently, when you eventually want the benefits from your pension plan, you have to buy something very strange known ...

  • Partnership shape

    30 May 2002

    IFAs trading as partnerships can gain valuable personal protection by converting to a limited liability partnership. Although the FSA has not yet produced specific rules for LLPs, it will generally treat an IFA LLP as a limited company. To assess whether it is advisable to change status from a partnership to LLP, consideration needs to be given to the benefits and disadvantages of such a change. What is an LLP? It is an entity that has been designed to share characteristics ...

  • Plain speaking?

    30 May 2002

    I found it hard to follow the logic behind the comments in the letter from Martin Cutts of the Plain Language Commission (Money Marketing,May 16) talking about the FSA website. Surely a website uses plain language or it does not. Why pick out bits of it, then hide the rest in "small print"? Add to the problem that the FSA site is not the easiest to navigate, plain language or not, just what did win the award? Was it the name? FSA? You know, the Food Standards Agency. Or is ...

  • Product Matters

    30 May 2002

    It is good to see Richard Buxton return to the retail market with a new fund - Schroder UK Alpha Plus. It may look superficially similar to other focus-type launches but the make-up of this fund is very different. The funds look to capitalise on the global strategy experience of Richard and Schroder as well as bottom-up stockpicking skills. It will have a large/ mid-cap focus with 20 to 40 stocks, which should ensure liquidity is not a problem. There is scope for it to look at ...

  • Public's trust in advisers is rising, says poll

    30 May 2002

    Trust in financial advisers is improving, with only 9 per cent saying they do not trust their advice compared with 15 per cent last year. According to Alliance & Leicester's wealth tracker index, the number of people who find financial advice patronising has halved since last year to 5 per cent from 10 per cent. The survey has also found an increased acceptance of paying fees for advice, with just 11 per cent of those questioned saying fees are an annoyance compared with ...

  • Pumping up pensions

    30 May 2002

    The headline-grabbing story from the Budget was the hike in National Insurance contributions. For the pension industry, this means an increased interest in salary sacrifice, the salary planning tool used to offset the effect of tax and NI for both employer and employee. The premise is simple. The employee opts to give up part of his salary (or bonus) and instead asks for it to be paid as an employer pension contribution. The benefits are that the employer can reduce his NIC bill (as ...

  • Rathbones bonds with ethical investors

    31 May 2002

    RATHBONESETHICAL BOND FUNDType: Unit trust Aim: Income by investing in ethical investment-grade bondsMinimum investment: Lump sum £1,000, monthly £100 Investment split: 100% in ethical investment-grade bondsYield: 6.2% gross a year Isa link: Yes Pep transfers: Yes Charges: Initial 4%, annual 1.25% Commission: Initial 3%, renewal 0.5% Tel: 020 7399 0399The panel: Peter Robinson, ...

  • Reducing the savings gap

    30 May 2002

    I am delighted at the robust defence of independent financial advice by the Consumers' Association. I also applaud their recommendation for a new maximum commission agreement. What a shame that previous governmental stupidity did away with the original. The current state of play confirms what the majority (of non-voters) believe - "it does not matter who you vote for, unfortunately the Government always gets in". I would suggest that any new agreement be termed a "capped commission ...

  • Scottish Legal Life closes to new business

    30 May 2002

    Scottish Legal Life has closed its doors to new business. The Glasgow-based friendly society, which has 175,000 members, had been undertaking a major strategic review. It had already cut operating costs by axing its direct salesforce last year. But the firm says the high costs of writing new business and the burden of regulation meant it was forced into the decision to cease to write new business. It says the costs were proving to be too much of a drain on members' res-ources. ...

  • Scottish Widows Bank Revision Round-up

    30 May 2002

    Part A of the syllabus for Cemap paper three and the bridge paper is entitled Advising Mortgage Clients and, unsurprisingly, candidates score relatively well in most parts of this section. This is probably for two main reasons. First, much of this subject area is covered in the earlier parts of the Institute of Financial Services' study manual. Students are therefore more likely to have studied the material in detail before study fatigue sets in. Second, an experienced ...

  • Sub-prime numbers

    30 May 2002

    Traditionally, the market factors that any mortgage adviser will immediately recognise as non-conforming, sub prime or adverse credit within an applicant's credit profile are - arrears, county court judgments and bankruptcy/individual voluntary arrangements. Conventionally, these have been the measure of an applicant's credit risk, with, for example, an applicant who has had some arrears in the past being viewed as a lower credit risk than one who has been bankrupt or has had ...

  • Summer surprises

    30 May 2002

    Three momentous matches will take place this summer. Ron Sandler will be reunited with his report (which has been circulating around Whitehall in draft for several months). Christine Farnish will take up her post as chief executive with the National Association of Pension Funds (which has been on the cards for weeks). And Gordon Brown will say hello to the euro (which was always going to happen), which he has shunned since he became Chancellor. I write this as a reminder as I know ...

  • Talkback

    30 May 2002

    "No. I think it will but drawdown has been one of the most heavily regulated areas and there really isn't any need." Paul Fox, Layton Blackham Group "Yes. Many people who have got drawdown have not always been made aware of the risks involved." Will Palmer,Atkinson Smith "No. Because most smaller IFAs, if they do not have G60, pass the business on to specialist qualified IFAs." Michael Rooney, Financial Solutions 2000 "No. Because advisers are doing income draw-down ...

  • Technology on show

    30 May 2002

    IFAs wanting to make technology work harder for them can catch up on the latest developments in software and e-commerce at the adviser.tech conference in Manchester next month. The first technology show exclusively aimed at financial advisers, adviser.tech brings together over 20 life offices and the principal technology suppliers. Microsoft UK industry manager for financial services David Slight will make a keynote presentation while IBM executive consultant David Taylor will ...

  • Teps to rise in the fall

    30 May 2002

    In September, an FSA rule change takes effect which will require life companies to inform clients who are considering surrendering their policy of the alternatives to surrender. This step is the result of investigations begun by the PIA and picked up by the FSA earlier this year when it issued Consul-tation Paper 106. This looked at the issue of telling endowment policyholders of their options, together with similar issues surrounding the open market option on pension annuities. This ...

  • The rotten state of regulation

    30 May 2002

    I agree with David Birkmyre that the current split/zero fiasco culpability appears at least in part to lie with the FSA, who approved what turns out to have been quite inappropriate promotional literature. Perhaps the task was assigned to an incompetent junior (and I wonder just how many of those the FSA employ) whose understanding of this class of investment was even poorer than those now in the firing line for having sold them. Has that individual or the head of the department ...

  • Tier pressure inflates costs

    30 May 2002

    Low-tier advice, or as some call it more harshly dumbed down advice, may not be the answer to everyone's prayers after all. Research by consultancy AT Kearney suggests that a lower-tier advice distributor firm would need sales of nearly £500,000 per salesman per year to turn a profit. Of course, the research is not definitive as it required the consultancy to create its own model for testing. Others may find imaginative ways around the financial hurdles - it did not, for ...

  • Tiner proposes 'more meaningful' reporting by life offices

    30 May 2002

    The FSA is considering forcing life offices to disclose more information to the public. The Tiner project, which is headed by FSA managing director John Tiner, aims to overhaul insurance regulation. It has set out proposals to make life offices give a clearer picture of the real nature and underlying risks of their businesses. Tiner says the current regime for reporting has become over-complex and voluminous. He claims it is difficult even for experts to understand the information ...

  • University challenge for FSA's head of training

    30 May 2002

    FSA head of industry training and business ethics adviser David Jackman has been appointed visiting professor at London Guildhall University's centre for financial regulation studies. Jackman, the architect of the training and competence regime that came in last November, will give lectures and advise on the content of financial services training courses. He will also be involved in research initiatives. Jackman chairs the British Standards Institute committee on financial services ...

  • Up, up and away in a hot-air balloon

    30 May 2002

    To celebrate its promotion of Family Income Benefit, Swiss Life (UK) plc is offering IFAs the chance to win a fantastic hot-air ballooning weekend for two in Chateau d'Oex, Switzerland. Chateau d'Oex is renowned as an international mecca for hot-air ballooning. Its exceptional micro-climate creates such ideal flight conditions that people flock to this part of Switzerland from all over the world. The winning IFA and partner will fly to Geneva and then travel by train through ...

  • Volatility brings big rise in regular Isa savings

    30 May 2002

    Legal & General is seeing a sharp rise in the number of regular Isa savers as investors spurn lump-sum investments due to stockmarket volatility The life office says there has been a 96 per cent rise in regular Isa business in the first quarter of this year as investors continue to be concerned about when is the right time to invest in the stockmarket. It believes that many have turned to regular savings with the aim of reaping the benefits of pound-cost averaging. L&G ...

  • Waiting too long

    30 May 2002

    Two weeks ago, I looked at how the industry might modify its approach to electronic new business processing to make it more attractive for IFAs to use. The natural counter point to any such development is the electronic delivery to advisers of information on existing contracts. Clients are always far more interested in the progress of the last product they bought on the adviser's recommendation than the prospects for any future contracts. A great deal of work has been going ...

  • Walls come tumbling down...

    30 May 2002

    Money Marketing hears the internet firewalls at L&G came tumbling down last week, prompting pensions guru Andy Agar to believe he was being subjected to a spam scam of monstrous proportions. Various get rich quick schemes were emailed to poor Andy - not to mention the "enhancement" offers (when they said well endowed they were not talking about mortgages) - who is meant to advocate the marvels of compound returns and regular investment for old age. But we hear the protective ...

  • Widows banks on IFAs

    30 May 2002

    Scottish Widows Bank, which is celebrating its seventh anniversary, prides itself on steadily building up a profitable mortgage business without the deeply discounted up-front rates and expensive consumer ads used by rivals. Distancing itself from young technology banks such as Intelligent Finance and Egg, Widows Bank is keen to emphasise its relatively low set-up cost of £1.2m in May 1995 when it was launched as the "first of the new breed of assurabank". Deputy managing ...

  • Widows improves website

    30 May 2002

    Scottish Widows is revamping its extranet service next month with the addition of fund performance data powered by Morningstar. The scottishwidows.co.uk/ifa site has been overhauled to give improved navigability, with more content available in front of the secure log-in. Morningstar will provide independent data analysis to help IFAs research and support investment decisions, as well as check clients' investments online. Users can access up-to-date valuations on Peps, Isas, ...

  • Will World Cup win over Asian markets?

    30 May 2002

    Some fund managers are using the World Cup to highlight the factors that they believe make Japan an attractive investment proposition. With the eyes of the world turning to the Far East for six weeks in June and July, Britannic is urging investors to reassess their views on Japan and take advantage of an economy it believes is on the brink of a strong recovery. Its optimism stems largely from the view that Japan's programme of restructuring coupled with its global growth will ...

  • Witan to help skier reach the summit

    30 May 2002

    Witan is to sponsor 19-year-old top skier Chemmy Alcott for five years. Alcott, who has been billed as the Kournikova of the slopes, is ranked eighth in the world for her age. She skied in the Salt Lake City Olympics, achieving 14th in the combined event, and made the cut in all five disciplines - super G, slalom, giant slalom, downhill and combined. Alcott is now in training for the 2006 Olympics, to be held in Turin. The sponsorship deal sits between Witan's support ...

  • With-profits endowments see 9% falls

    30 May 2002

    Maturity values for 25-year with-profits endowments are down by an average of 9 per cent, according to Money Marketing Online's With-Profits Survey 2002. Mutual insurers generally provide the best returns. Liverpool Victoria is the best performer this year, with a £20 a month investment yielding a maturity value of £45,139 over 25 years. Royal London, Wesleyan and Standard Life also feature in the top six. Worst performer is Scottish Equitable, where a £20 ...

  • With-profits governance

    30 May 2002

    The governance of a with-profit fund is not simple but can it be straightforward? Paper 5 in the series of consultative papers published by the FSA as part of their review of with-profit funds deals with governance and the role of appointed actuary. In the paper the FSA proposes five options for the future governance of with-profit funds and all are worthy of review. Option 1 would require the directors to define the principles and practices of financial management. This basically ...

  • World Cup win 'could put boot in to economy'

    30 May 2002

    Success for England in the World Cup would be unlikely to stimulate the UK economy, according to Halifax. Although the economy tends to be more buoyant when England reach the quarter-finals, it is often fairly weak if the team progresses to the last four, its survey found. Halifax says the news will come as a blow to politicians, who it claims often schedule elections during World Cup campaigns to benefit from the national "feelgood factor". On the two occasions when England ...

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