Money Marketing
3 March 2004

  • 'Don't knock networks'

    4 Mar 2004

    Mortgage network HomeLoan Partnership has hit out at Bankhall's comments that networks limit consumer choice and are not a long-term solution for brokers. Managing director Martin Cave believes Bankhall group sales director Shaun Godfrey's views are extreme. He points out that the FSA believes a well researched and regularly monitored panel of lenders is representative of the whole market and wonders why Godfrey cannot see this. Cave thinks a customer does not need ...

  • £3m cash injection for Lifeboat

    4 Mar 2004

    Adviser group Lifeboat Financial has secured £3m of new funding from a private investor to help support its future growth programme. The Telford group is believed to have secured funding from a well-known name in the insurance market but will not disclose the name until the deal has been finalised. Following the departure of David Kitchen, Bill Wynn has taken over as chief executive. Wynn says the funding will enable Lifeboat to reach its expansion targets ...

  • Abbey axes annual bonuses

    3 Mar 2004

    Abbey has admitted that no annual bonus will be paid for the with-profits policies of Abbey National Life, Scottish Mutual and Scottish Provident except where guaranteed rates of bonus apply. Terminal bonus rates will also be reduced for unitised and traditional with-profits policies from March 2004. Abbey says the stockmarket recovery has been too short and insufficient in scale to make up the shortfall from the previous three years.

  • Abbey in shake-up for wrap

    4 Mar 2004

    Abbey's group marketing director is taking charge of its criticised wrap platform as part of a major structural reorganisation which will see the management team handed other responsibilities. Janet Connor is taking on the role largely performed by marketing director of wealth management and banking Hugo Thorman. Head of wrap for intermediaries Steve Conley is set to be handed other group responsibilities. Connor is expected to try and close long-running negotiations ...

  • Abbey sets aside £373m to meet solvency rules

    4 Mar 2004

    Abbey set aside £373m last year so Scottish Mutual and Scottish Provident can meet the FSA's yet to be published solvency regulations for life companies, with overall losses of £686m compared with £947m in 2002. Abbey says the solvency regime will have a negative affect on its life companies and admits it is possible that additional capital will need to be injected once the FSA makes its final position clear although it says this would be modest in the context ...

  • Aberdeen to contest watchdog ruling

    3 Mar 2004

    Aberdeen Asset Management plans to appeal against a provisional Financial Ombudsman Service judgement which could force it to pay compensation to thousands of investors. The FOS adjudicator has ruled in a lead case that an investor in AAM's progressive growth unit trust - which invested in split caps - is entitled to compensation. But AAM says it will contest the ruling in a bid to avoid having to pay redress to up to 7,000 investors in the fund.

  • Advisers will be probed on rebated commission

    4 Mar 2004

    IFAs will be questioned over the amount of commission they rebate back to clients as part of the FSA's bid to calculate the market average commission under its menu proposals. The FSA is proposing to carry out regular surveys of advisers to derive the effect of direct rebating on the commission figures so it can more accurately calculate what the market average should be. This information will be collated with data from product providers on how much commission they ...

  • Ample to develop wraps as Carruthers focuses on IFAs

    4 Mar 2004

    Consumer fund supermarket Ample will be developed into an extensive wrap platform and rolled out to IFAs following its acquisition by Tomas Carruthers, the former chief executive of Interactive Investor. Carruthers, who helped Interactive Investor through its 1991 acquisition by AMP and subsequent merger with Ample, has paid an undisclosed sum for the business which he intends to develop into an IFA-focused platform. This will involve building up an open architecture offering ...

  • Arla asks MPs to tackle landlords in rental sector over deposit abuse

    3 Mar 2004

    The Association of Residential Letting Agents is asking an all-party group of MPs for help in tackling deposit abuse in the Private Rented Sector by giving letting agents and their landlords an explicit choice. The body wants to see landlords meet either the standards of an appropriate lettings industry body or hand over tenants' deposits to a mandatory custodial scheme run by a government body.Speaking to the MPs at Westminster ARLA chief executive Adrian said he thinks it ...

  • Audit Office new sums could contradict Treasury

    4 Mar 2004

    The National Audit Office says it is carrying out fresh research that could contradict the Treasury's assessment of the £1.4m lifetime pension fund limit. Chancellor Gordon Brown has said he might drop the entire pension simplification programme if the NAO finds against him. Many industry figures had seen the referral to the NAO as a rubber-stamping exercise but the body - which functions independently of the Government and answers only to MPs - says it will ...

  • Audits or plaudits?

    4 Mar 2004

    Judgement day for the pension simplification review comes in the next fortnight and will open old wounds in the relationship between Prime Minister Tony Blair and Chancellor Gordon Brown. When the National Audit Office publishes its review of the effect that the Inland Revenue's proposal for a £1.4m lifetime limit will have on pension saving and the numbers who will be affected, both Number 10 and Number 11 Downing Street will be looking to claim victory. But ...

  • Aviva profits boost as it backs realistic regime

    4 Mar 2004

    Aviva profits rose by 11 per cent last year and the comp-any says it welcomes the FSA's new realistic reporting regime. Its operating profits increased to £1.91bn last year from £1.72bn in 2002. This figure includes life profit, amortisation of goodwill and exceptional items. Aviva's results compare favourably with Prudential, which showed a drop of 27 per cent in operating profit to £794m from £1.1bn. Total sales in the UK and European ...

  • Axa feels positive despite fall in life and pensions

    4 Mar 2004

    The Axa Group has seen positive results for 2003 despite a flat performance in UK life business. Its group results show adjusted earnings of £1.4bn last year compared with £1.3bn in 2002, with UK life and pension business earnings down by £152m to £30m from £182m. New UK life and savings business was also down by 11 per cent to £471.3m from £529.6m. Axa Sun Life chief executive Paul Evans says the firm saw positive growth ...

  • Axa IM appoints two new fixed-income fund managers

    5 Mar 2004

    Axa Investment Managers has appointed Gareth Isaac and Jamie Grant as fund managers on its fixed-income team.Isaac, who joins from Newton Investment Management, will assume responsibility for running multi-currency and liquidity portfolios while Grant - formerly with the Commonwealth Bank of Australia - will focus on credit derivatives. Both will report to UK head of fixed income Denis Gould.

  • Axa Investment Management - Axa MultiManager Select Higher Income Portfolio

    4 Mar 2004

    Type: Oeic fund of fundsAim: Income and growth by investing in UK corporate, government and high-yield bondsMinimum investment:: Lump sum £100,000Investment split: 100% in UK corporate, government and high-yield bondsIsa link: YesPep transfers: YesCharges: Initial 5%, annual 1.5%Commission: Subject to negotiationTel: 020 7003 1234

  • Axa Investment Management - Axa Select Active Portfolio

    5 Mar 2004

    Type: Oeic fund of fundsAim: Growth by investing globally in equities through segregated mandates and collective investment fundsMinimum investment: Lump sum £100,000Investment split: 100% global equitiesIsa link: YesPep transfer: YesCharges: Initial 5%, annual 1.5%Commission: Subject to negotiationTel: 020 7003 1234

  • Axa Sun Life cuts with-profits payouts

    3 Mar 2004

    Axa Sun Life has cut bonuses for its 1.65m with-profits policyholders, with bonuses on bonds cut to 2 per cent for the year to March 2004, from 2.5 per cent the previous year and personal pensions cut to 2.25 per cent from 3 per cent. Bonuses for mortgage endowments with a 3 per cent guarantee remain at that level. Sun Life Assurance Society bonuses fall to 2.25 per cent from 3 per cent on bonds, to 3 per cent from 3.75 per cent on personal pensions and to 2.25 per cent from 3 per cent ...

  • BAM takes new direction

    8 Mar 2004

    Baring Asset Management's directional global bond trust is a unit trust set up to take advantage of the European directive Ucits III.Ucits III allows fund managers of onshore funds to use mixed asset classes and go short, whereas previously shorting was only available offshore without the safety net of FSA regulation. This fund's unit trust structure means it is FSA regulated and eligible for Isas and Pep transfers, despite the ability to go short.The fund aims to ...

  • Baring Asset Management - Baring Directional Global Bond Trust

    8 Mar 2004

    Type: Unit trustAim: Growth by investing long and short in Government bonds and money market instrumentsMinimum investment: Lump sum £1,000Investment split: 100% in bonds and money market instrumentsIsa link: YesPep transfers: YesCharges: Initial 5%, annual 1.75%Commission: Initial 3%, renewal subject to negotiationTel:020 7214 1900

  • Base rate stays at four per cent

    4 Mar 2004

    The Monetary Policy Committee voted today to keep the base rate at four per cent for another month.Charcol senior technical manager Ray Boulger says: "Whilst the housing market shows no sign of a downturn, the Bank of England is likely to have viewed February's reported sharp rise in house prices as a one-off, hence no knee jerk reaction this time around. Inflation is still well below its two per cent target, so there was no real immediate pressure for the committee to quell. ...

  • BBB winds up national shell and leaves liabilities with compensation scheme

    4 Mar 2004

    Berkeley Berry Birch is winding up the shell of its national IFA firm and dumping its liabilities on to the Financial Services Compensation Scheme in a corporate reorganisation. The move has provoked uproar among the IFA community who say BBB is offloading liabilities which will have to be picked up by other IFAs through the FSCS levy. The levy has risen in recent years and covers compensation claims on firms such as Towry Law subsidiary Advizas, RJ Temple and The David Aaron ...

  • Bee in her bonnet

    4 Mar 2004

    Gillian Thomas, a consultant at Carr Sheppards Crosthwaite, was the 100,000th visitor to the BeeHive, the website hosted by Scottish Life head of pensions strategy Steve Bee. Her prize? A signed cartoon by none other than Bee himself along with a bottle of Champagne. Thomas says:"I am a big fan of Steve's cartoons so naturally I am delighted to win an original."

  • BM launches switching option for buy-to-let

    9 Mar 2004

    BM Solutions has launched a fee free switch option with its base rate tracker. Borrowers are able to switch from the tracker rate, which is at base rate plus 1.99 per cent, to any product in BM's buy-to-let range at any time during the life of the product.Senior product manager John Bianco says: "The tracker product will give our customers the ability to switch to any rate in our generic range. This is the latest move to maintain our reputation as the most flexible and innovative ...

  • Brown must back down on ISA limits

    9 Mar 2004

    The Chancellor of the Exchequer is being urged to do more to encourage personal savings With the 2004 Budget just a week away.ISIS Asset Management is calling on Gordon Brown to back down on his plans to reduce the annual Individual Savings Account allowance from £7,000 to £5,000 in the 2005/6 tax year.ISIS Asset Management director head of communications strategy Jason Hollands says: "Over the last year the UK Household Savings Ratio has averaged around 5.5 ...

  • Buoyant Britannic looking to buy

    3 Mar 2004

    The Britannic Group looks to be on the acquisition trail following the release of its full year results this week. In the results it says the board believes there is "significant opportunity" for it to increase the scale and profitability of its closed fund business via acquisition and administration of other closed funds. Its closed fund business currently includes Britannic Assurance, Alba Life and Britannic Retirement Solutions. The Group posted a modified statutory profit of £64m ...

  • Cable calls for Parliamentary Ombudsman

    9 Mar 2004

    Liberal Democrat Treasury Spokesman Vincent Cable has called for the Parliamentary Ombudsman to investigate whether compensation is due and in what forms.Cable says although Penrose does not make recommendations on compensation the report holds that policy holders have had much worry and distress, with many continuing to experience financial hardship.He says the Government's reaction to the Penrose report is "a total whitewash and seeks to distort Lord Penrose's findings".Cab

  • Capital gains tax

    3 Mar 2004

    The following are the key tax planning opportunities available in the area of capital gains tax. The annual capital gains tax exemption for individuals is £7,900 for 2003/04 and £3,950 for most trustees. The exemption is available to both a husband and wife, so between them capital gains of up to £15,800 in this tax year can be realised without any CGT liability. Gains under a bare trust are currently treated as having been made by the beneficiary, regardless ...

  • CBI welcomes NAO assessment

    9 Mar 2004

    The CBI has welcomed the National Audit Office's assessment of the number of people affected by the lifetime limit on pension savings, saying it is an important step towards resolving lingering problems.Deputy director-general John Cridland says that, now the figures have been agreed, the industry can focus on getting simplification while ironing out the remaining issues. He says: "It was the Government's constructive amendments to its provisions that have helped bring the ...

  • Chancellor moved goalposts, says Tories

    9 Mar 2004

    Shadow secretary of state for work and pensions David Willetts says he is not surprised that Chancellor Gordon Brown's estimate of the number of people affected by the lifetime allowance received scant support.He says: "By using the 20:1 factor for valuing benefits against the lifetime allowance instead of a more variable figure, he was always going to be able to reduce the number of people affected."However, there is a much more important point in all this. The challenge is ...

  • Chartwell teams up with Pinnacle to offer 4.33 per cent on GIB

    5 Mar 2004

    Chartwell Investment Management has teamed up with Pinnacle Insurance to offer investors 4.33% p.a. net of basic rate tax on its 3 year guaranteed income bond.This is equivalent to 5.41% gross for basic rate taxpayers and 5.77% gross for higher rate taxpayers.The rate is available for a minimum investment of £10,000 on a first come, first served basis.

  • Chessells to complete FirstAssist board line-up

    8 Mar 2004

    FirstAssist has appointed Sir Tim Chessells as a non-executive director, completing its holdings board team.The addition means it can now move ahead with plans for the business, with Chessells also becoming a member of its remuneration commission, and is to chair its group audit committee.He is a chartered accountant, trained by Arthur Young where he was a partner for 17 years. He has also held non-executive roles for organisations such as the Legal Aid Board, where he was chairman, ...

  • Child's play for Downing

    9 Mar 2004

    Downing Corporate Finance is raising up to £6m for the Nu Nu enterprise investment scheme, formerly Downing Nurseries.Under the original EIS offer in March 2002, Downing outsourced the management of the nurseries to Nu Nu, an experienced nursery operator. Nu Nu was later acquired by Downing and the EIS was renamed. The money raised under this share offer will be used to fund four new nurseries in 2004 and will help the company achieve its target of at least 15 nurseries by ...

  • Clocking off

    4 Mar 2004

    In a perfect fiscal world, tax planning strategies would be considered and action taken all year round. In real life, however, people are busy with other more commercially pressing matters for much of the year, such as generating enough income and assets to need tax planning in the first place. The approach of the end of the tax year provides opportunities for taxpayers to maximise the use of the available personal allowances, reliefs and exemptions for the current year. Frequently, ...

  • Close Property Investment - Fixed Uplift Properties

    3 Mar 2004

    Type: Closed-ended fundAim: Growth and income by investing in UK commercial propertyMinimum investment: Lump sum £25,000Investment split: 100% UK commercial propertyPlace of registration: Isle of ManCharges: Annual 3.5%, performance fee 20% Commission:Initial 3.15%Tel: 0870 733 3773

  • Code comfort

    4 Mar 2004

    The Consumers' Association has been campaigning fiercely on many fronts to reform the financial services industry so that it works in the consumer and national economic interest. We have seen major improvements in key sectors but we are not easing up. We are looking at ways of "freeing the prisoners", that is, the millions of policyholders left in with-profits who are vulnerable to unfair practices. The biggest challenge is to make sure that what improvements we have ...

  • Commercial break

    4 Mar 2004

    My Sipp contains a commercial property valued at £250,000, which I may sell, plus £100,000 in cash. What are my options and are there any other issues I should know about concerning gearing up to buy more property? Property purchase within a Sipp is relatively straightforward under current legislation. The Sipp must place a deposit of at least 25 per cent and may borrow the remainder to purchase commercial property. Most institutions restrict themselves to lending ...

  • Commission comparison on menu

    4 Mar 2004

    IFAs will have to compare how the commission they get adds up against the market average, according to long-awaited FSA proposals for the menu-based system of payment published last week. The menu was finally released last week after significant delays alongside a feedback statement to CP166 outlining the final depolarisation rules. The menu will oblige all advisers, whether tied or independent, to tell consumers what they charge and how that compares to the market. For ...

  • Correspondent's week

    4 Mar 2004

    Off to lunch with the Antichrist. But the Prince of Darkness is late - even later than me - as he manages to lose himself in Clerkenwell's alleys. When Satan, aka Julian Penniston-Hill of trail commission-grabbing Intelligent Money fame, sits down, we realise we have spoken before. He invented those IFA Isa booklets which used to fall out of newspapers (not The Guardian). We both bemoan their passing - Julian because they were great earners and me because I lost easy ...

  • CPG advisers leave after admin move

    3 Mar 2004

    The advisers of high-net-worth IFA Corporate Planning Group, the Fareham firm that was placed into administration last week, will not be sold en bloc says administrator Tenon Recovery. Tenon says the firm's 82 RIs are leaving the firm to pursue their own business interests.

  • Crawshaw takes over as Rodrigues quits B&B

    4 Mar 2004

    Bradford & Bingley group chief executive Christopher Rodrigues has resigned in a move some believe will lead to B&B returning to its core business and selling off recent IFA acquisitions. Rodrigues, who joined B&B in 1996 as chief executive and engineered an unpopular demutualisation in 2000, is moving to San Francisco to become president and chief executive of Visa International. He will be replaced by Steven Crawshaw, managing director of lending and savings. Crawshaw ...

  • Critical slump at ScotEq

    4 Mar 2004

    Scottish Equitable Protect's sales of critical-illness policies have dropped significantly since it withdrew from the guaranteed rate market. In 2002, critical cover accounted for around 50 per cent of the total protection book and in 2003 this dropped to around 30 per cent. The company says this reflects a variety of factors. It says some providers have kept guaranteed rates but at the cost of conditions covered such as angioplasty. It still offers angioplasty as ...

  • Dawney Day Quantum - Protected China Fund

    9 Mar 2004

    Type: Capital-protected fundAim: Growth linked to the performance of the FTSE/Xinhua China 25 IndexMinimum investment: Lump sum £5,000-no maximum, Isa £7,0007Investment split 100% linked to the performance of the FTSE/Xinhua China 25 IndexTerm: Six yearsReturn: Up to 70% growthGuarantee: 90% of original capital returned regardless of performance of index, 95% of original capital returned provided ...

  • Digest

    4 Mar 2004

    The Diary would like to warn readers against becoming too enthusiastic at conferences. It seems there was more going on at the Funds Network IFA Forum in London than just the usual fund manager chit-chat. The delegates got rather carried away with the conference's Superstars theme. Things got so competitive that First State's Richard Jones challenged Fidelity's Tom Carron, Invesco Perpetual's Bob Yerbury and First State's Angus Tulloch to a press-up competition ...

  • Digest

    4 Mar 2004

    Penile dysfunction does not often make it on to the pages of this perfectly functioning organ but it has come to the Diary's attention that it has been exercising the (some might argue smutty) minds of the mortgage market. Well, one poor Manchester broker, anyway. Imagine the surprise of the poor wee fella (the broker, that is) when, on returning the call of a freelance journalist, he was asked: "Are you calling about premature ejaculation?" "Erm, no, I don't think so," ...

  • Direct Life in express delivery with underwriting deal

    4 Mar 2004

    Protection IFA Direct Life & Pensions Services says it has developed the first tele-underwriting service for the IFA market. Sales and marketing director Richard Verdin says the group developed the process, called Express Underwriting, in a bid to improve protection distribution. Verdin believes advisers in the UK are generally ill-equipped to support or advise clients on how to complete application forms asking for detailed medical and family history. DLPS's ...

  • Downing Corporate Finance - Nu Nu

    9 Mar 2004

    Type: Enterprise investment schemeAim: Growth by investing in children's day nurseries in the UKMinimum investment: Lump sum £2,500Closing date: April 5, 2004 for 2003/2004 tax year, July 30, 2004 for 2004/2005 tax yearCharges: Initial 6.5%Commission: Initial 2.5%Tel: 020 74114700

  • Drawdown offer from Norwich Union

    9 Mar 2004

    Norwich Union is removing plan management and early encashment charges from its Trustee Investment Product used for income drawdown. The only charge it will make will be the 0.625 per cent annual management charge.Norwich Union says it expects income drawdown to grow in the run-up to pension simplification in April 2005.Norwich Union head of retirement product development Simon Warsop says: "The feedback we have had from IFAs is that simplicity and flexibility are the key ...

  • Equitable calls on Parliamentary Ombudsman to reopen inquiry

    8 Mar 2004

    Equitable Life says policyholders have suffered enough and is calling for the Parliamentary Ombudsman to re-open her enquiry into the insurer.In protest to the Government's refusal to allow it to see the report in advance of today's publication, it says there will be an "unnecessary vaccuum" as it reviews and digests the report before providing a further statement.It says policyholders have suffered enough and a "fair, fast and final" solution is needed, wanting to see the ...

  • Fears that menu may be overdone

    4 Mar 2004

    Aifa and the ABI have welcomed the FSA's menu proposals but believe that the plan risks becoming overengineered. Aifa director general Paul Smee believes the menu will enable the value of advice to be spelt out alongside its cost which will boost consumer confidence. He feels the principal of equivalence is strongly backed by the FSA and, as it will apply across all channels, there will be no inference that commission is a second-rate way of paying. Smee says: "Although ...

  • Fee-based IFAs escape market requirement

    4 Mar 2004

    Fee-based IFAs will not have to demonstrate how their charges compare with the market average. The FSA says because firms charge fees in a variety of different ways, a meaningful comparison of rates to the market average is not a viable proposition to help consumers understand pricing. It argues that commission is more directly related to the type of investment, its term and the amount invested but fees can be worked out from any number of bases. Fee Based Advice ...

  • Fidelity Investments wins fund group of the year

    8 Mar 2004

    The 2004 Lipper Fund Awards Ceremony saw five fund management companies receiving awards in six categories.Fidelity Investments won best overall group and best bond group. Marlborough Fund Managers won best overall equity group, and Merrill Lynch Investment Managers won best UK equity group. Newton Fund Managers won best non UK equity group, and Investec Asset Management won best mixed asset group.Lipper chief executive officer Michael Peace says: "Lipper is delighted to ...

  • FSA gives companies two-week deadline on splits' redress

    4 Mar 2004

    The FSA has handed companies which are embroiled in its probe into the split-capital investment debacle two weeks to decide whether they are prepared to contribute to its radical collective compensation process. The 21 companies - including Aberdeen and BFS - have until March 16 to decide whether to take part in negotiations aimed at ensuring that they pay suitable compensation and that disciplinary action is taken where appropriate. If companies decide not to participate ...

  • FSA puts endowments, LTC and drawdown on menu

    4 Mar 2004

    The FSA has included products such as endowments, long-term care and income drawdown in its menu plans even though it concedes they would not be considered mass-market products. It says it has tried to keep the menu as simple as possible but it includes products outside those most commonly sold, believing they "have particular risk of detriment" to consumers. Endowments, drawdown, LTC, investment trust saving schemes, purchased life annuities and FSAVCs will all be included ...

  • FSA takes menu on the road

    5 Mar 2004

    The FSA is holding a series of roadshows for providers and advisers to help them understand the major reforms that will take place with implementation of the menu for the retail advisory investment market.The roadshows are aimed at trying to demonstrate how the approach will bring greater transparency to financial services and will focus on the implications of the menu and depolarisation for the industry and consumers.Roadshows will be held in London (22 and 26 April), ...

  • FSA: We reached the right decision

    8 Mar 2004

    The FSA says it reached the right decision with its actions over Equitable Life.In response to the Penrose report FSA chairman Callum McCarthy has defended the regulator's approach saying it reached the right decisions at the time but he accepts much of the previous regulatory regime needed to be overhauled.He says although Penrose's specific criticisms of the FSA highlight that when Equitable put itself up for sale, the FSA did not properly explore possible options ...

  • Gasparro joins Threadneedle

    4 Mar 2004

    Former Schroders retail chief David Gasparro has joined rival Threadneedle to co-ordinate the group's retail strategy for the UK and Europe. Gasparro, who left his role as head of investment products last September, becomes head of retail responsible for overseeing growth in areas including France and Switzerland, where Threadneedle has recently launched businesses. He will also look after the UK retail business, which saw its share of IFA sales grow 18 per cent last ...

  • Giving a tax break

    4 Mar 2004

    It is not often that you get the chance to tell the finance profession they have missed a trick when it comes to making the most of tax breaks for their clients but in the sphere of charitable giving that seems to be the case. Last year, the British public gave around £7.3bn to charity but simply by changing the way they give, this could have been around £900m more and given donors generous personal tax relief. The Giving Campaign - a national initiative to ...

  • Government expected to disappoint with Penrose release today

    8 Mar 2004

    The Government is expected to disappoint Equitable Life policyholders today by denying it has any obligation to provide compensation to those who lost money in the insurer's near collapse.Speculation over the weekend suggests financial secretary to the Treasury Ruth Kelly is likely to say the problems at Equitable are more to do with a "hands off" regulatory framework put in place by the Conservatives, than by failures by officials to enforce rules.It is believed the ...

  • Government should push on with pensions simplification, says IMA

    9 Mar 2004

    The IMA has welcomed the NAO findings and says the Government should push ahead with pension tax simplification as a result.Chief executive Richard Saunders says: "More than any other proposal currently under discussion, pension tax simplification holds out the prospect for decisive change for the better in the long term savings market and will allow for the development of highly attractive pension products for savers."

  • HBOS nears target for investment products

    4 Mar 2004

    HBOS says it is closing in on its goal of being number one for sales of investment products in the UK in its 2003 preliminary results, which show a 29 per cent increase in profit and exceptional items to £3.89bn from £3.06bn in 2002. It has also pledged to tighten its lending criteria. The five HBOS mortgage brands achieved total gross lending of £71.8bn from £56.8bn along with an above target market share for net lending of 25 per cent. Its target was ...

  • IFA chiefs' pay falls by 20% at big companies

    4 Mar 2004

    The directors of big IFA businesses have seen big cuts in salary and bonuses compared with general brokers, according to a report from IMAS corporate advisers. The annual report compares the fortunes of the top 200 general and life distributors in the UK based on company accounts. Directors of big IFAs with turnover above £10m saw their income fall sharply by 20 per cent. Smaller IFA businesses with turnover below £10m saw income rise by 10 per cent but this ...

  • IFAP figures reveal big benefits for providers

    4 Mar 2004

    IFA Promotion's consumer and business hotlines and website generated £31m for IFAs in 2003, according to analysis by consultancy Mercer Oliver Wyman. The research quantified and tracked Ifap's core IFA referral service. Its results show that IFAP has more than doubled the commission generated for member IFAs in three years from £14.5m to £31m. A total of 338,000 people contacted Ifap last year to get the details of IFAs in their area - a 7 per ...

  • IFAs believe commission will retain pre-eminence

    4 Mar 2004

    IFA networks believe the menu will increase clients' understanding of charging structures but do not think it will cause a significant increase in the number opting for fees. Simply Biz chairman Ken Davy believes that the clearer the information the client has of the costs of different types of distribution for different financial services products the more they will understand of the advantages of having an IFA. Tenet chairman Barry Kayes and Informed Choice managing ...

  • IFAs will not compromise independence over GPPs

    4 Mar 2004

    IFAs signing up staff to group personal pensions will be all-owed to describe themselves as independent even though a group personal pension provider has already been selected. The menu proposals say a firm enrolling employees into a GPP will not compromise its independent status if the scope of advice is restricted to advising on joining that scheme only. Independent firms will be able to continue using their stationery and trading names in GPP situations where the provider ...

  • IHT

    3 Mar 2004

    Since the Labour Party came to power in 1997, perhaps one of the biggest tax surprises has been the lack of significant change to the inheritance tax rules. But inactivity in this area is set to change as the Government announced in its pre-Budget report that it intends to introduce legislation to charge income tax on any benefit enjoyed by the donor of a major capital asset. This provision will affect people who make gifts of such assets - such as a home or chattels - and then ...

  • Income tax - independent taxation

    4 Mar 2004

    Independent taxation planning still forms a central plank of tax planning for married couples. Most of these strategies need a full tax year to operate to give maximum effect so these suggestions may serve as a reminder for the coming tax year. A husband and wife each have their own personal allowance. This is particularly relevant where one spouse is a non-taxpayer, 10 per cent taxpayer or basic-rate taxpayer and the other a higher-rate taxpayer. A non-working spouse can receive ...

  • Income tax - pensions

    4 Mar 2004

    The Inland Revenue has recently released its second consultation paper on the introduction of a new simplified tax regime for pensions. If the proposals get the final go-ahead, they will apply to all existing approved pension arrangements. However, the new provisions will not come into effect until April 6, 2005 at the earliest. In the meantime, most individuals should seek to maximise their pension provision and take full advantage of the favourable tax treatment available to ...

  • Independent view

    4 Mar 2004

    One of my clients recently did a very silly thing. He tried to set up a pension on his own using an application form from Norwich Union. He had just left the employ of one of my bigger corporate clients and taken up with a new one. The employer was happy to pay into the existing provider's scheme on his behalf. Easy, right? Well, no actually. The client included my name on the application form as his adviser and referred all queries to me in the covering letter. I ...

  • Ingledew leaves BBB

    5 Mar 2004

    Berkeley Berry Birch has announced that group chief executive Stephen Ingledew is to leave with immediate effect.Executive chairman Clifford Lockyer is to add the chief executive's job to his responsibilities, with finance director Craig Butcher continuing as finance director.The announcement comes less than a week after it emerged BBB is winding up the shell of its national IFA Berry Birch & Noble Financial Services, dumping any potential liabilities on the Financial ...

  • Interested Parties

    4 Mar 2004

    Having set the scene on trust reform, let us look at those proposals that are likely to have greatest impact on the everyday life of financial advisers. Solutions involving trusts will be applicable to estate planning, business insurance, family protection, pensions and investment planning. Existing trustees may also be targeted as a potential source of business. The consultation on trust reform will be highly relevant to all these business areas and advisers need to ...

  • Investment analysis

    4 Mar 2004

    With the exception of Japan, where share prices rose sharply, it was a fairly quiet week for equities with most of the world's major indices ending last week slightly lower. By Friday's close, the FTSE World index had fallen 0.1 per cent. In the UK, the FTSE 100 fell by 0.5 per cent. MMO2 saw its shares jumping by more than 15 per cent on the back of bid talk. It was not such a good week for Abbey National, whose shares fell by 15 per cent after reporting higher than expected ...

  • Investment view

    4 Mar 2004

    It does no harm to have luck on your side. Too many investment managers fail to acknowledge the part that luck can play in the performance of their portfolios and it is starting to look as though Chancellor Gordon Brown is enjoying more than a little good fortune at present. Last week's revision to economic data suggests that the economy has been growing closer to the long-run average of 2.5 per cent than previously thought. This time last year, few expected UK plc to perform in such ...

  • Investors and IFAs agree on ISA destinations

    8 Mar 2004

    ISA preferences for private investors are currently matching the recommendations being made by independent financial advisers according to new research by JPMorgan Fleming Asset Management.Most ISA investors are keeping their money in UK followed by Europe and North America, which are also the top destinations for IFAs. However, in forth place investors favour Japan whereas IFAs favour China.JPMorgan Fleming global head of equities Martin Porter says: "As the home market, ...

  • io introduces inflation beater

    9 Mar 2004

    IO INVESTORSio InflationPlusType: Oeic fund of funds Aim: Income and growth in excess of UK inflation by investing globally in fixed-interest funds and equities Minimum investment: Lump sum £1,000 Investment split: 100% fixed interest funds and equity funds Isa link: Yes Pep transfers: Yes Charges: Initial 5%, annual 1.5% Commission: Initial 3%, enewal 0.5% Special ...

  • ISIS named Scotland's top plc for social responsibility

    8 Mar 2004

    ISIS Asset Management has been named the leading Scottish company for corporate social responsibility.The Scotland PLC Awards 2004 judging panel was chaired by Lloyds TSB Scotland chief executive Susan Rice.Receiving the award ISIS Asset Management company secretary and group risk director Marrack Tonkin said: "We are delighted to have been recognised for our commitment to the highest standards of corporate social responsibility both in the management of our own business and the ...

  • Julian Gibbs

    4 Mar 2004

    Close Brothers always comes up with innovative property investment plans. One I particularly like is Fixed Uplift Properties, which invests in commercial property. Since the Investment Property Databank started its index of commercial property 32 years ago, commercial property has risen by an average of 12.1 per cent a year. Unlike property bonds, however, Close Brothers can enhance returns by using low-cost debt because it is now possible to borrow at a fixed rate of ...

  • Keep the menu simple

    4 Mar 2004

    IFAs were left breathing a collective sigh of relief last week when the long-awaited menu was finally published by the FSA. While the publication of the menu itself is noteworthy in that it allows the depolarisation exercise to proceed, it is the fact that direct and tied salesforces will be obliged to employ it which has been seen as the real victory in many quarters. DSFs and tied salesforces will have to display commission equivalence, defined as salary plus anything ...

  • Key looks for partner in move on LTC market

    4 Mar 2004

    Equity-release specialist Key Retirement Solutions is searching for a partner to help it expand into the long-term care market. It is keen to find a partner for LTC either through an acquisition, partnership or a joint venture. Managing director Colin Taylor says the company is aiming at the LTC market as its client base of 120,000 is predominantly over 60 and ideally suited for LTC products. The Preston IFA also wants to realise the potential of the rapid growth ...

  • Kreis puts value in capital

    4 Mar 2004

    Kreis Consulting is looking for up to £3.3m to add up to six pubs to Tomahawk pubs. This is an enterprise investment scheme that differs from most EISs by providing income through dividends, as well as the usual capital growthThe EIS was established in 2002 to buy and develop rundown pubs in the London area and has raised over £1.8m from investors. It currently operates two pubs - the Morgan Arms in Bow and the Duchess of Kent in Islington. These pubs aim to recreate ...

  • L&G cuts bonuses as life profits rise by 7%

    4 Mar 2004

    Legal & General has cut with-profits bonus rates despite achieving a 14 per cent investment return on with-profits assets last year. The company says returns in 2003 were in excess of its longer-term expectations but negative returns in 2001 and 2002 were well below expectations so smoothing means this has not yet been fully reflected in bonus declarations Annual bonuses on conventional endowment policies have been cut to 0.75 per cent of the sum assured and to 1.25 per cent ...

  • L&G has the cure after NU fails medical

    4 Mar 2004

    I am an IFA and wrote a policy on myself and my wife. Here is how the story goes. I have just bought a house and need life cover. With five weeks to completion of contracts, we take out the life cover with Norwich Union for £210,000. With three weeks to completion of contracts, Norwich Union advises us that a paramedic would contact myself and my wife to carry out a brief medical at home. Two weeks to go and no one has got in contact to arrange ...

  • Labour spends money on advertising; we'll spend it on pensioners - David Willetts

    8 Mar 2004

    Speaking at the Conservative Party Spring Forum in Harrogate shadow pensions secretary David Willetts panned Labour for spending £47m on advertising means-tested benefits. He promised that his party would cut the advertising 'explosion' by the Department for Work and Pensions.Willetts said: "Why do you think there's another expensive advertisement from the Government trying to get pensioners to claim the Pension Credit? It is because 2m pensioners who are entitled ...

  • Legal & General cleans up in protection awards

    4 Mar 2004

    Legal & General has cemented its position as a favourite in the protection market, winning awards for best overall provider, best service provider and best e-commerce provider at the inaugural LifeSearch Protection Awards. The awards, held last week, are aimed at providing recognition of protection providers' new business and underwriting teams from an IFA perspective. The awards were decided on votes by LifeSearch staff working in the relevant departments. The ...

  • LIA targets loan advisers as it aims for professional status

    4 Mar 2004

    The LIA is aiming to attract mortgage brokers into its fold as it moves towards being a true professional association. The association previously concentrated on tied salespeople and IFAs. Mortgage advisers presently make up about 1,200 of the 20,000 LIA members. Director general Mark Ommanney says there are tens of thousands of loan advisers who would benefit from LIA membership. He says mortgage advisers have the Association of Mortgage Intermediaries but are ...

  • Lib Dems: Treasury got £1.4m numbers wrong

    9 Mar 2004

    The Liberal Democrats have lashed out at the Chancellor following the release of today's National Audit Office report into the £1.4m lifetime contribution limit for pensions.Lib Dems pensions spokesman Lord Matthew Oakeshott has said even though Gordon Brown "rigged" his own question, the result shows twice as many will be affected by the cap than the Government contended.He says: "Even on Gordon Brown's own rigged and narrowly defined question, twice as many ...

  • Life returns to favour

    4 Mar 2004

    Wouldn't it be great if you could avoid income and capital gains tax on investment gains? Well, that is exactly what you can achieve with some relatively simple planning using life insurance policies. The current level of Government spending has forced the Chancellor to increase the tax yield. This has led the financial services industry back towards the focus that was pervasive in the 1970s, which is that tax planning is a key part of the advice process and one where you can ...

  • Lifetime allowance must be fair - ABI

    9 Mar 2004

    The ABI has reminded Chancellor Gordon Brown that any decisions he makes about the proposed £1.4bn pension fund lifetime allowance must be both balanced and fair for present and future savers.Head of pensions and savings Joanne Segars says: "It is essential that the current complex and unwieldy tax regime governing pension funds is simplified and the introduction of a lifetime allowance will make it easier for consumers to understand pensions, and employers to set up schemes."This ...

  • Liverpool Vic says realistic regime will not hit capital

    4 Mar 2004

    Liverpool Victoria has trimmed with-profits policy bonus rates but claims its financial strength holds strong, with the FSA's realistic reporting regime not expected to have any negative effects on its capital position. Cuts to annual bonus rates range from 0.2 per cent to 0.35 per cent, with final bonuses dropping by between 5.1 per cent and 15.3 per cent. Annual bonuses on with-profits pension annuities and unitised with-profits policies are unchanged, as announced last month. The ...

  • Liverpool Victoria welcomes Penrose

    9 Mar 2004

    Mutual Liverpool Victoria has welcomed the Penrose report, reiterating its commitment to mutuality "for many years to come".Chief executive Malcolm Berryman says Liv Vic supports the report and will co-operate with the review into corporate governance of mutuals.Berryman underlined that although Liv Vic is governed by the Friendly Societies Act, it also complies with underlying principles of the 'Combined Code', which requires separation of chief executive and chairman, ...

  • Lloyds TSB profit before tax up 66 per cent

    8 Mar 2004

    Lloyds TSB's 2003 results show an increase in profit before tax on a statutory basis of £1.730bn or 66 per cent to £4.348bn from £2.618bn in 2002.However, Lloyds points out that to enable meaningful comparisons to 2002, it is necessary to exclude the gains on business disposals, investment variances, and changes in economic assumptions for the group's life assurance business. If this is done, profit before tax actually decreased in 2003 by 4 per cent to ...

  • Marlborough Stirling results show profits down

    3 Mar 2004

    Technology firm Marlborough Stirling's end of year profits show total turnover down to £114.6m from £121.0m in 2002. Profits have also decreased with adjusted pre-tax profit at £10.6m from £11.3m last year. Reported pre-tax profit showed a loss of £34.5m from 2002 to this year's £2.5m. But after a period when the board has been unable to recommend a dividend it will now recommend 0.5p that will be paid on 1st June 2004 to shareholders on ...

  • Menu makes IFAs much cheaper than direct sales

    4 Mar 2004

    IFAs are revealed to be up to four times cheaper than services offered by their direct-selling rivals in the FSA's menu proposals. Despite a fierce rearguard action fought by the banks and other direct operations, the FSA has decided to apply the menu to them as well as IFAs rather than opting for the proposal set out by the banks. According to figures submitted to the FSA 18 months ago by a steering group comprising trade bodies and product providers as part of the ...

  • Menu makes IFAs much cheaper than direct sales

    4 Mar 2004

    IFAs are revealed to be up to four times cheaper than services offered by their direct-selling rivals in the FSA's menu proposals. Despite a fierce rearguard action fought by the banks and other direct operations, the FSA has decided to apply the menu to them as well as IFAs rather than opting for the proposal set out by the banks. According to figures submitted to the FSA 18 months ago by a steering group comprising trade bodies and product providers as part of the ...

  • Millfield two leave for Lifetime

    3 Mar 2004

    Millfield non-executive directors Derek Noone and Jeremy Bradburne are standing down to focus on the business plan for Lifetime, the wrap technology business in which the national IFA holds a 41 per cent stake. Norwich Union holds a 49.5 per cent in Lifetime.Millfield chief executive Paul Tebbutt says: "I look forward to Derek and Jeremy's continuing efforts at Lifetime delivering strong returns for all Millfield's stakeholders."

  • Mortgage Express acquires GMAC-RFC portfolio

    5 Mar 2004

    Mortgage Express has completed the purchase of a mortgage loan portfolio from GMAC-RFC for around £480m.The acquired mortgages are buy-to-let, self-cert and standard mortgages. All lending in the portfolio is secured on UK residential property, and average loan size is approximately £117,000 with an average loan to value of approximately 74 per cent.Mortgage Express agreed in December to acquire up to £1.4bn of loans from GMAC-RFC in 2004.Mortgage ...

  • MPs set to attack endowment bosses - reports

    9 Mar 2004

    Reports today claim that the Treasury's report into restoring confidence in long term savings: endowment mortgages, to be published on Thursday, will be one of the strongest attacks ever made on the the financial services industry.The reports say that directors will be told by the Treasury Committee that their 72 per cent pay rises are unjustified, and that policyholders should have been warned about their financial position between five and ten years ago.

  • Multi-talented

    4 Mar 2004

    The latest fund sales report reveals that Credit Suisse attracted almost 20 times more money than Henderson and four times more money than Jupiter in the fourth quarter of 2003. Anecdotal evidence had long suggested that Credit Suisse was way ahead of the pack but until the report was published - revealing for the first time sales of multi-manager funds - no evidence existed to support this contention. But now the industry can see how the market is panning out and the ...

  • Mutual life offices' corporate governance to be reviewed

    9 Mar 2004

    Financial Secretary to the Treasury Ruth Kelly has commissioned two independent reviews as a consequence of the findings of the Penrose inquiry.Paul Myners is to lead a review into the corporate governance arrangements applicable to mutual life offices, and will look at board accountability for mutual life offices and the level of regulation to which they are subject by the FSA, amongst other things.Sir Derek Morris will lead a review of the actuarial profession, and Kelly ...

  • NAO estimate is reasonable

    9 Mar 2004

    The National Audit Office's findings on the lifetime allowance estimate for pensions is reasonable, says Watson Wyatt head of executive reward consulting John Ball.Speaking on the NAO's research into the impact of the £1.4m lifetime pensions cap Ball says consulting firm Watson Wyatt has also done research which broadly supports the NAO's findings that some 7,000 to 10,000 people will be affected by the cap, not the 5,000 initially claimed by the Treasury.However ...

  • NAO report allows Revenue pensions simplification

    9 Mar 2004

    The National Audit Office's report backs up the Treasury's views and paves the way for the Inland Revenue to implement pensions simplification, HR consultants Hewitt Bacon & Woodrow assert.Speaking on the NAO's research into the impact of the £1.4m lifetime pensions cap Hewitt Bacon & Woodrow pensions consultant Andy Cox says the NAO has generally supported the Government's figures on how many people will be affected by the cap and this means no change to proposed ...

  • NAO says Treasury numbers affected by lifetime limit

    9 Mar 2004

    The National Audit Office says the Treasury's estimate of the numbers likely to be affected by the £1.4m lifetime limit is only half the figure it thinks will be hit.Th NAO also says there is a "thin evidential base" for the Treasury's estimate of a further 1,000 people a year affected by the limit that would not have been affected by the price cap under the existing regime.But the report says there is great uncertainty over estimates that go far into the future ...

  • New structured product from Woolwich

    8 Mar 2004

    The Woolwich is launching a capital growth plan that guarantees a minimum return of initial investment after the five and a half-year term and the potential to achieve 100 per cent upside on the FTSE 100.The bond, available through intermediaries until April 30, 2004, is available for investors with a minimum £3,000 and a maximum £500,000. The plan is also available as an Isa investment for the current or following tax year, a direct investment or as a Pep or Isa transfer. ...

  • Northern Venture Managers - Northern 3 VCT

    9 Mar 2004

    Type: Venture capital trustAim: Growth by investing in unquoted companiesMinimum investment: Lump sum £3,000Closing date: April 5, 2004Charges: Initial 5%, performance fee 20%Commission: Initial 3%Tel: 0800 0852601

  • Nothing is free

    4 Mar 2004

    I refer to recent correspondence on who pays for adding a five-year capital guarantee to a with-profits policy. To say policyholders do not pay as the cost comes out of the free assets is typical of the lack of transparency in with-profits. What this explanation fails to point out is the free assets come from amounts held back from policyholders so, ultimately, of course, the policyholder pays. It is just this sort of continuing refusal to face up to the fact ...

  • NU offers new group PMI product

    3 Mar 2004

    Norwich Union Healthcare has launched a new "superflexible" group private medical insurance product aimed at schemes for between 10 and 49 employees.The move is an extension to their Solutions product and is described as a modular offering. This means that on top of its core set of benefits, extra benefits can be added and a range of "cost containment" options selected from, with employers able to mix and match options to best fit company structure, needs and current benefits. NU ...

  • NU says NAO conclusions are no surprise

    9 Mar 2004

    Providers say they are not surprised by the outcome of the National Audit Office's review of the Government's £1.4m lifetime contribution limit cap published today.Norwich Union says it expected the NAO to largely agree with the Revenue's estimates of who would be affected immediately and in the future by the implementation of pensions simplification including the lifetime cap.NU Life strategic development director Stephen Mann says: "We're not at all ...

  • O'Leary to lead Marlborough Stirling

    3 Mar 2004

    Software and services provider Marlborough Stirling is appointing Mike O'Leary as chief executive, leaving Huw Evans to revert to his previous role of chairman after holding the post since Graham Coxell stepped down a year ago. O'Leary was at Misys from 1996 to 2000, holding the role of chief executive of its financial services division and of its US healthcare arm.

  • One, two, three O'Learys

    4 Mar 2004

    Staff at tech outsourcing operation Marlborough Stirling were expecting a tall Irishman when they heard that a West Midlands football manager called O'Leary was taking over as chief executive. Staff were bracing themselves for a tell-all autobiography and wise words on playing 4-4-2 until it was revealed that his first name was Michael and not David. Staff then figured it must be the head of Ryanair, having jumped ship from the turbulent world of airlines for the relative ...

  • Out of context

    4 Mar 2004

    •"We will just get back to our McFlurries." - Abbey for Intermediaries head of protection, marketing and product development Nick Kirwan enjoys fine dining on the road. •"I watched the Brits on television last night and could not remember anything about being there." - Scottish Widows PR Paula Sutherland. •"I performed at the Millennium Stadium, Twickenham, St Mary's and White Hart Lane and all in the same week." - AMI policy officer Ben Stafford. •"I ...

  • Penrose critisises Board for policy omission

    8 Mar 2004

    The decision to recover the costs of annuity guarantees from terminal bonuses was not for a decade disclosed to the Board, which failed to inform policyholders for another three years, according to the Penrose report.The report says this failure must be regarded as a serious omission in communication to policyholders of relevant information about their prospective interests from at least 1988.

  • Penrose Report to be revealed on Monday

    5 Mar 2004

    Publication of the long awaited Penrose report into what went wrong at Equitable Life is finally to take place in full on Monday. Financial secretary Ruth Kelly is also to make a statement to Parliament about the report on the same day. The 818-page report has been with the Treasury since December and has been referred to the Serious Fraud office.

  • Pensions simplification will go ahead says Standard Life

    9 Mar 2004

    Chancellor Gordon Brown is expected to proceed with pensions simplification after the National Audit Office has not fundamentally disagreed with the Government's proposals, says Standard Life.It believes that given the NAO failed to significantly challenge the Inland Revenue's numbers, the Chancellor will push ahead with the full package of reforms.Standard senior technical manager John Lawson says: "It would be very strange for the Chancellor not to ahead based on ...

  • Personal Touch Insurance launches online conveyancing service

    9 Mar 2004

    Personal Touch Insurance has launched an online conveyancing service, Personal Touch Conveyancing.The service is for intermediaries registered with PTI. PTI says it can save their clients up to 40 per cent on their conveyancing bills and for every completion the intermediary will earn a £50 fee.The service is provided in partnership with the PSM Law Group, a Scottish legal firm.Managing director Mike Allison says: "This is just one example of the many opportunities ...

  • Pink Home Loans - 10-to-Let mortgage

    4 Mar 2004

    Type: Discounted-rate buy-to-let mortgageDiscounted term: Until July 31, 2005Discount: 1%Payable rate: 5.1%Minimum loan; £25,000Maximum loan: Up to 85% of valuation subject to a maximum of £1m, up to 80% of valuation subject to a maximum of £2m, up to 75% of valuation subject to no maximumIncome multiples: Rental income must be at least 130 of mortgage repaymentsFlexible features: ...

  • PInk offers landlords flexi option

    4 Mar 2004

    PINK HOME LOANSMortgage Trust Flexible Buy-to-Let Libor TrackerType:Flexible buy-to-let tracker mortgageTracker term: Three yearsTracker rate: Libor plus 0.95%Payable rate: 4.995%Minimum loan: £30,000Maximum loan: Up to 85% of valuation subject to a maximum of £250,000, up to 80% of valuation subject to a maximum of £500,000, up to 75% of valuation subject to a maximum of £1m, ...

  • Problem unique to Equitable - Penrose

    8 Mar 2004

    The ABI says the Penrose Report shows the problems at Equitable Life were unique to that company and not symptomatic of life offices in general.The ABI has welcomed the further reviews announced by Treasury financial secretary Ruth Kelly but says they must avoid imposing costly or unnecessary burdens on the rest of the industry.ABI director general Mary Francis says: "The report confirms Equitable's problems, particularly its policies of over-promising and under-reserving, ...

  • Product companies welcome clarification

    4 Mar 2004

    Product providers believe the clarification of key issues of the menu will allow the industry to move forward. Norwich Union says it supports depolarisation but is concerned that investment rules will be extended to all intermediaries and that the same menu approach could be used across all forms of distribution. Clerical Medical is pleased that firms will have to disclose the higher of commission equivalence or commission paid if they recommend the products of a provider ...

  • Protection policies online from Friends

    4 Mar 2004

    Friends Provident has set up an online underwriting service for protection business through major portals such as Assureweb and the Exchange. Friends says the eSelect Protection system will give immediate online underwriting decisions for cases where no further medical evidence is required, which is estimated to be more than of 60 per cent of cases, cutting the process down to minutes. IFAs are kept in touch with progress throughout the process and can print out a policy document. The ...

  • Providers can give tech cash

    4 Mar 2004

    Product providers will be allowed to give direct support, including cash, to help IFAs with technology for their businesses. The rule change extends provision of reasonable indirect benefits to include information technology support. Providers will be able offer IFAs cash or help towards developing software or computer facilities. The provision will be at the FSA's discretion and it will judge on a case-by-case basis what constitutes reasonable support. Financial ...

  • Providers slam Pannell claims over house prices

    4 Mar 2004

    Providers have hit back at Durlacher analyst David Pannell after he claimed in Money Marketing last week that house prices are set to fall by 30 per cent in the next two years and spark a flurry of misselling claims. Norwich Union has hit out at Pannell's comments that the equity-release market is bound almost inevitably for a misselling scandal, saying that when equity release is sold properly, it is no more likely to provoke misselling claims than any other product. Mortgage ...

  • Prudential is set for return to CI market

    4 Mar 2004

    Prudential looks to be taking its first tentative steps towards re-entering the critical-illness market in earnest after the pipeline drama that left it badly scathed last year. Pru incurred IFA wrath after it raised premiums and withdrew guarantees on new and pipeline critical-illness business last April. But following an apology to IFAs by UK chief executive Mark Wood last September, Pru is in talks with IFAs with a view to again becoming a force in the market. Prudential ...

  • Rathbone sets up division to focus on ethical sector

    4 Mar 2004

    Rathbone Investment Management has started a specialist unit, Greenbank, to service clients wanting to make ethical investments. Chief executive Roy Morris says Rathbone's ethical investment business has grown to the extent that it has decided to establish Greenbank to further its commitment. He says Greenbank will build on Rathbone's key strengths of independence and focus on client service and will enable them to be developed for a particular client base. Investment ...

  • Refusal to pay indemnity shows little faith in IFAs

    4 Mar 2004

    Following recent property acquisitions, I elected to increase my life cover by £250,000 for the next 10 years and applied to Scottish Equitable, who appeared to offer the cheapest premium according to comparisons sourced from The Exchange. My application was submitted online. However, a few days later I was contacted by Scottish Equitable, who told me that they would not be prepared to pay indemnity commission because I am an IFA but instead would reduce the premium accordingly. Le

  • Regulators failed Equitable says Penrose

    8 Mar 2004

    There was a general failure on the part of the regulators and the Government Actuary's Department to follow up issues during their regulation of the Equitable Life, Lord Penrose has concluded in his report published today.The regulatory scrutiny of the Equitable Life did not keep pace with industry developments Penrose says.The 818 page report, published two and a half years after Penrose was commissioned by the Treasury to look into the events surrounding the near-demise ...

  • Regulatory tools should prevent another Equitable says Penrose

    8 Mar 2004

    FSA proposals aimed at reforming regulation of the life insurance industry could provide the necessary tools to prevent another Equitable Life from occuring, Penrose's report says.While the regulator has "sought to anticipate many of the lessons that might be drawn by this inquiry," Penrose says the tools it may design as a result will be "useless unless the personnel charged with their use have the skills and experience necessary for their effective application."He ...

  • Richard Verdin on protection

    4 Mar 2004

    There is something fundamentally wrong about the way most companies write protection today. For the last six years, I have been fortunate enough to work with some of the UK's foremost experts on protection. I have worked with some of the brightest actuaries, the most experienced underwriters, the cleverest IT professionals, the best distribution strategists in the business and the market-leading entrepreneurs. All of which means I have been standing next to the best ...

  • Royal Liver joins Marlborough Stirling for IFA launch

    3 Mar 2004

    Royal Liver is joining up with Marlborough Stirling ahead of its launch into the IFA market in the UK. Under a ten year contract Marlborough will offer Royal Liver its electronic quotation and new business transaction services via the Exweb portal. It will also use 'Lamda' Marlborough's new business processing solution, that allows straight through processing from Exweb to back office administration, including automated underwriting and acceptance of the majority of ...

  • Royal London warns regulation will kill off WP

    4 Mar 2004

    Royal London is warning that with-profits will die and funds will close if proposed regulation is not substantially altered. Group chief executive Mike Yardley says: "If the proposed rules are not fundamentally changed to reflect the realities of managing with-profits funds, many life companies will have no option other than to close their with-profits funds to new business." Royal London has cut annual bonuses on conventional with-profits endowments from 1 per cent to ...

  • Royal London welcomes Government reviews

    9 Mar 2004

    Royal London has welcomed the Government's move to commission two independent reviews in the wake of the Penrose Report believing it will go some way to restoring consumer confidence in the industry.It says it recognises the importance of a review of the actuarial profession, including the Government Actuary's Department, saying sound actuarial management and prudential supervision of life companies is central to market confidence.Royal London says it recognises the need ...

  • Royal Skandia boosts fund range

    9 Mar 2004

    Royal Skandia has added eight funds in four currencies to its self-select range.The funds - from companies such as First State, Fidelity and JPMorgan Fleming - include the US equity fund managed by T.Rowe Price.Royal Skandia marketing manager Nic Burton says, "We are delighted to make this fund available through Royal Skandia. Larry Puglia and his team's track record in managing over $9bn US Large-Cap Core strategy is market-leading and we believe it will appeal to Royal ...

  • Schroders - Schroder UK Large Cap Fund

    8 Mar 2004

    Type: Unit trustAim: Growth by investing in UK large capsMinimum investment: Lump sum £1,000, monthly £50Investment split:100% in UK large capsIsa link: YesPep transfers: YesCharges: Initial 5.25%, Isa 3.25%, Pep transfers up to 4%, annual 1.5%Commission: Initial 3%, renewal subject to negotiationTel: 0800 718 777

  • ScotLife produces a strength guide in bid to reassure IFAs

    4 Mar 2004

    Royal London chief executive Mike Yardley is writing to IFAs to say he has no reason to believe any of the problems identified in Standard Life will affect Royal London or its subsidiary Scottish Life. ScotLife is publishing a guide to financial strength for plcs and mutuals, which is available through its sales consultants. It examines the new format of realistic financial reporting and covers free-asset ratios, waivers, imp- licit items and financial engineering for mutuals ...

  • Seasonal software

    4 Mar 2004

    With one month to go until the end of the tax year, it increasingly appears there is an Isa season taking place. Around 50 per cent of Isa investments via IFAs are now placed via fund supermarkets, as opposed to 20 per cent of all new Isas. Cofunds told me recently that it is already seeing a threefold increase in new Isa cases over this time last year. Fidelity suggests that while we have not yet returned to the levels of the busiest Isa seasons three or four years ago, there ...

  • SEI looks to expand US consultancy business to UK advisers

    4 Mar 2004

    SEI Investments' new head of wealth relations Chris Hylen says the multi-manager is to undergo a major repositioning which will see it branch out into bespoke business consultancy. Hylen was until recently director of communications for SEI's US adviser network, where he helped build around 5,000 outsource partnerships with US advisory firms. But after the group's successful foray into business consultancy, he has come to the UK to see if there is a market for ...

  • Sesame is slammed on mortgage choice

    4 Mar 2004

    Sesame's new mortgage offering has come in for heavy criticism from some of its leading rivals. The company allows brokers to choose between Mortgage Select, with a small panel of lenders and higher procuration fees, and Mortgage Market, which covers every lender in the market but the deal is believed by some not to be in the best interests of consumers. Charcol senior technical manager Ray Boulger says from a consumer perspective, the deal is not very attractive as ...

  • Skandia adds Templeton funds

    8 Mar 2004

    Skandia has chosen two Franklin Templeton Investments funds to link to its UK life and pension range.The Templeton growth and Templeton US equity fund will appear on Skandia's platform from March 1.Skandia fund range marketing manager Richard Vincent says: "The addition of these two funds further back up our commitment to ensure that our fund range remains focused towards the needs of our clients."

  • Skandia profits surge and assets reach record £16bn

    4 Mar 2004

    Profits at Skandia UK leapt by 121 per cent to £158m last year from £72m in 2002. Assets under management inc-reased by 30 per cent to a record £15.8bn from £12.2bn. Skandia's overall life and pension business fell by 1 per cent from £361m to £365m. The company's share of the IFA market increased from 4 per cent to 4.7 per cent. Unit-linked bond sales doubled to £48m and protection sales rose by 50 per cent from £20m ...

  • Skills of former Equitable board inadequate - Penrose

    8 Mar 2004

    The skills of Equitable Life's former board were inadequate for the job and it never got to grips with the society's true financial position, according to Lord Penrose in his report on the insurer.Penrose says critical responsibilities for valuing liabilities, assessing the liability implications of new products and identifying and monitoring risk were carried out by a "discrete part" of the society that was not scrutinised effectively or challenged.He says Equitable's ...

  • Small is beautiful for Ruffer

    8 Mar 2004

    RUFFER INVESTMENT MANAGEMENTCF Ruffer Pacific FundType: Oeic Aim: Growth by investing in equities and bonds in the Asia Pacific region Minimum investment: Lump sum £1,000 Investment split: 34% cash, 16% basic materials, 12% non-cyclical consumer goods, 11% financial,9% cyclical consumer goods, 5% communications, 4% industrial, 3% utilities, 2% energy, 2% government, 2% other Isa link: Yes Pep transfers: ...

  • Smith says Govt may compensate wind-up victims

    4 Mar 2004

    Work and Pensions Secretary Andrew Smith has admitted that the Government will consider offering discretionary assistance to the 60,000 pensioners whose pension schemes have been wound up. Speaking in an Opposition half-day debate on Crisis in Pension Scheme Wind-Ups last week, Smith said he would not raise false hopes of compensation for people who have been left with little or no pension fund following the closure of their schemes. But he conceded that the Government is looking ...

  • SOFA'S view

    4 Mar 2004

    I am writing this at the end of my first day as Sofa managing director. It was a hectic day that proved to be everything I had hoped - challenging, exciting and with a warm welcome from the Sofa and CII teams. The issue of professional status, qualifications and competence has been debated endlessly over the years and will no doubt continue to be debated for many years to come. My approach is much simpler. Over the years, working as an IFA and within life companies, I never felt ...

  • Software helps IFAs cope with commission changes

    4 Mar 2004

    Electronic commission specialist CBoxx has launched its Business Profiler software, the first of a four-step approach to handling all elements of commission and fee income for big IFAs. It is also rolling out an income-forecasting package to allow advisers to check the remuneration they expect to receive against actual payments. CBoxx believes its software will help IFAs model the financial impact of changes in the commission regime to produce the cost of advice menu ...

  • SPREFS offers smaller bite at property

    3 Mar 2004

    Strutt & Parker Real Estate Financial Services has designed a commercial property fund for retail investors with small amounts.The Sprefs UK commercial Property fund invests in commercial property through an the Deutsche UK managed property fund. The Deutsche fund is an institutional fund with a minimum investment of £250,000 so retail investors would otherwise not be able to invest in it. However, via the Sprefs fund, they can invest from as little as £15,000 or £3,000 ...

  • Standard Life reduces critical rates

    3 Mar 2004

    Standard Life is moving to cut its critical illness rates, with the changes mainly affecting accelerated critical illness cover which see cuts of an average 20 per cent. The changes took effect on February 27, with Standard targeting the mortgage market and younger lives. Accelerated critical illness benefits on its level, mortgage, renewable and convertible protection plans will see savings. Improvements have also been made to terms on children's CI benefits.

  • Standard slashes direct salesforce jobs

    4 Mar 2004

    Standard Life is slashing its direct sales arm by more than half, reducing the number of direct sales staff to 270 from 630 with the potential loss of 360 jobs. The number of direct sales branches will fall to 11 from 21.The restructuring will see the existing direct customer division divided into three separate business units - telesales, corporate account management and direct client management - and will be known collectively as Standard Life Direct.As a result of the ...

  • Strutt & Parker Real Estate Financial Services - SPREFS Commercial Property Fund

    3 Mar 2004

    Type: Closed-ended fundAim: Growth and income by investing in UK commercial propertyMinimum investment: Lump sum £15,000, Isa £3,000Investment split: 19.7% industrial, 25.3% offices, 55% retailPlace of registration: DublinCharges: Initial 5%, annual 1.25%Commission: Initial 3%Tel: 0870 420 5511

  • Survey reveals that IFAs fear disruption from complexity

    4 Mar 2004

    More than half of IFAs believe the menu will cause significant disruption to their business, according to the most recent Money Marketing online survey. The survey of 341 IFAs, immediately after the release of the FSA's menu plans last week, has given weight to industry claims that the menu is overly complex and will be difficult to implement. Fifty-seven per cent say it will disrupt their business. The survey has also cast doubt over the effectiveness of the new framework ...

  • Talkback

    4 Mar 2004

    "No. Unless there is a dramatic increase in interest rates, I do not think house prices will fall at all." Paul Harrold, Harrold Financial Planning " No. House prices will steady back a little way but I cannot see them dropping that dramatically. However, the first-time buyer market has dried up and this is what drives prices." Malcolm Morris, Premier Independent Investments UK "It is way off the mark. House prices are going to continue upwards." Paul Simms, Mortgage ...

  • Terence Rowe

    4 Mar 2004

    Stepping into the prestigious Naval and Military In & Out Club in St James's Place, London SW1, it is difficult to believe I will be meeting a South African who arrived off the boat with £150 and a backpack barely 15 years ago. But Alpha to Omega director Terence Rowe has not wasted the past 15 years at the Springbok Bar in Shepherds Bush. He has been busy building a strong IFA practice in Cameron Rowe and, for the past few years, a unique network offering in Alpha ...

  • The miles file

    4 Mar 2004

    There was a reminder of the importance of share dividends last week when Barclays published the latest edition of its much respected equity-gilt study. Although the message has been trumpeted many times, the headline figures from the study are worth repeating. Any saver foolish enough not to reinvest dividends pays a heavy price. According to Barclays, £100 invested in a basket of UK equities in 1899 - the penultimate year of Queen Victoria's reign - would today ...

  • Tied sector faces equivalence

    4 Mar 2004

    Banks and tied agents will have to disclose commission equivalence, according to the FSA's menu proposals which were released last week. The move comes despite heavy lobbying by the tied sector, which was broadly reluctant to have to reveal how much it pays advisers. The FSA has identified five types of advisers and is determined to make the tied sector disclose commission equivalence, which includes any payment they receive from product providers. Product ...

  • Tilney hedges and protects

    5 Mar 2004

    Tilney Asset Management has established Opal Tailored notes, a capital-protected fund of hedge funds.This offshore fund is linked to the performance of the opal optimum strategy fund, a fund of hedge funds. Investors have two investment options. They can choose to protect 100 pr cent of their original capital and will also get 100 per cent of any rise in the underlying fund. Alternatively they can protect 80 per cent of their original couple, in which case they will get 175 per ...

  • Tories call for investigation into Government actuaries

    9 Mar 2004

    The Shadow Chief Secretary to the Treasury Howard Flight is calling for a full investigation into the operation of the Government Actuary's Department after the publication of the Penrose report yesterday.He says the degree and extent of the department's maladministration must be established so that the question of compensation can be properly addressed. And he emphasises that the Treasury should make good losses directly attributable to negligence or incorrect interpretations ...

  • Treasury's move risks misselling

    4 Mar 2004

    The Treasury is loosening its grip on advice in the workplace in an effort to boost take-up of group personal pension and stakeholder schemes but concedes that the move could lead to more misselling. The Treasury's two-year review of the Financial Services and Markets Act includes a reworking of regulation to improve accessibility and take-up of pension schemes. It admits that the relaxation of the rules designed to protect employees from unsui-table advice from people ...

  • We have forgotten the principles of equity investment

    4 Mar 2004

    So Standard Life has sold a further £7.5bn of equities to reduce its long-term investment funds under the with-profits arena to only 35 per cent of assets. When will everyone realise that this action is pathetic? Equities must constitute a greater proportion of longer-term investment funds, especially when the alternatives (gilts and corporate bonds) have been at their most expensive for up to 50 years not too long ago. People need to return to the basics. If people ...

  • When is a with-profits policy not with-profits? When it is invested in bonds

    4 Mar 2004

    Many with-profits funds are now entirely invested in bonds. Who ever would have thought that Pearl, NPI, London Life, or the Equitable Life, Royal, Sun Alliance and indeed many other WP funds would eventually be exclusively, or at least nearly so, invested in bonds? The impact of this will be to guarantee that investment returns will be most unlikely to exceed 4 per cent a year net of costs and tax. The impact on maturity values where the policy is associated with a mortgage, ...

  • Who is policing policy changes?

    4 Mar 2004

    It was interesting to read in Product Matters about Norwich Union's commitment to with-profits (Money Marketing, February 19). The strange thing is that it does not offer a with-profits contract any more. You can call a bed a chair because you can sit on it but the other way round it becomes a very restless night. I have just received an email from the actuarial department at Norwich Union where it confirms that its with-profits policies have not been with-profits ...

  • Who should be compensated not part of inquiry - Penrose

    8 Mar 2004

    Despite Equitable Life policyholders have suffered "much worry and distress" as well as "real financial hardship" from the insurers' near collapse, Lord Penrose has not gone so far as to identify who is at fault and who should get redress.In his report released today into what went wrong at Equitable, Penrose says it was no part of his inquiry to answer these two questions.However, he does state he believes the regulatory system has failed policyholders in this case, but goes ...

  • Win a top PC package plus a digital camera

    4 Mar 2004

    Brush up on your technology with a chance of winning a top of the range PC package and digital camera To mark the launch of Winterthur Life's new online Portfolio Balancer, Money Marketing is joining forces with the pension and investments provider to offer one lucky IFA the chance of winning a top of the range Compaq PC package. But we want you to have some fun so we have also thrown in a Sony digital camera complete with software for downloading your favourite photos including ...

  • Win a trip to Monte Carlo

    4 Mar 2004

    In 1953, Sir Edmund Hillary was the first person to officially climb Mount Everest and reach the summit. Almost 50 years later, in February 2003, Sterling also broke new ground by launching the pioneering Protected Profits Funds, the first open-ended funds to combine performance and protection in this way. One year on and the Protected Profits Funds have reached new heights. The fact that the funds have grown to over £330m in the first 12 months shows just how attractive ...

  • Winterthur fund range goes on the defensive

    4 Mar 2004

    Winterthur Life is introducing a range of defensive managed funds for pension and investment bond investors. The funds will aim at cautious investors by offering lower volatility through a conservative split of around 67 per cent in bonds and 33 per cent in equities. Asset allocation will initially be 26.5 per cent in UK equities, 6.5 per cent in international equities, 46 per cent in UK fixed interest, 6.9 per cent in global fixed interest, 6.2 per cent index-linked ...

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