Money Marketing
7 April 2004

  • 'Demutualisation essential to raise capital for growth'

    8 Apr 2004

    The need for capital has prompted Standard Life to move away from mutuality. Standard says while its review has revealed a well-diversified portfolio of UK and international businesses, it will increasingly struggle for capital in the future and needs more access to capital from outside the company. The board intends to put a proposal for demutualisation to policyholders at its annual meeting in 2006. With-profits policyholders who signed three-year waivers before March ...

  • 'General election likely to scupper moves'

    8 Apr 2004

    The possibility that homereversion schemes will be statutorily regulated is rap-idly diminishing, given the Government's busy schedule in the run-up to a general election, according to a senior industry source. Regulating home-reversion schemes would require primary legislation, something which would take time and which the source believes is unlikely to be at the top of the Government's priority list, with only 18 months expected until the next election. The source ...

  • 'Standard sounds death knell for Scottish firms'

    8 Apr 2004

    Scottish National Party leader John Swinney has warned that Standard Life's demutualisation could sound the death knell for the financial services sector in Scotland. The Shadow First Minister of the Scottish Parliament is accusing the FSA of forcing Standard Life's hand and is calling for close scrutiny of the regulator's role in Standard's decision. Swinney says the loss of 1,000 jobs from Standard by the end of the year will be the start of devastating ...

  • 2.2% rise in March puts average house price over £150k

    8 Apr 2004

    The average UK house price climbed above £150,000 for the first time in March, reaching £151,467, according to Halifax's house-price index. House prices rose by 2.2 per cent last month following an increase of 1.7 per cent in February. The annual rise in prices is 18.5 per cent. Halifax says the gap between the average house price in Greater London and the North has fallen by almost £10,000 over the past year. Prices continued to rise most ...

  • A consumer's view

    8 Apr 2004

    IFAs are a conservative lot. IFA Promotion has updated its website and in particular the facility for potential customers to search and find an adviser who specialises in the area where the person needs advice. Very good it is too. Last year the website had 338,000 enquiries, which it was able to channel towards a suitable IFA. IFAP's research shows that some £31m has been generated in commission income for IFAs up to the end of 2003 using these leads. IFAP covers ...

  • A fine couple

    8 Apr 2004

    Norwich Union media relations manager Louise Goffee is looking to make a new life for herself this weekend when she marries Andrew Soulsby in Yorkshire. Sweet Louise, as evidenced in the pictures of her and Andrew at the tender age of three, met her future husband while both were working for Railtrack. As a result, many believe the pair will be highly unlikely to make it to the altar on time, with calls of "Mind the gap" ringing out as Andrew is aged 42 and Louise 34. The ...

  • A high price to pay for Bamford's PI insurance

    8 Apr 2004

    Your journal has now provided Nick Bamford with the opportunity to complain about his treatment at the hands of the wicked Professional Indemnity underwriting market twice in four weeks, yet there is another side to the story. At the eighth hour, I was asked to meet with Nick and his broker with a view to offering terms on behalf of Magian Mutual as an alternative to the holding insurers, with whom Nick expressed dissatisfaction. I agreed and participated in what I consider ...

  • A question of class

    8 Apr 2004

    Just months after it decided to shift towards manager of manager, £1.4bn investment trust Witan has revealed that it may branch out in other asset classes to boost flagging performance. Chief executive Jim Horsburgh said last week that the equity-driven portfolio could soon invest in fixed interest, private equity, absolute return funds and property in what would be a drastic shift away from existing policy. The move has been hailed in some quarters as a progressive ...

  • AAM seals deal with Arlington

    8 Apr 2004

    Aberdeen Asset Management has completed the long-awaited sale of its UK and European property arms to business solutions firm Arlington in a deal worth £50m. AAM, which pulled out of talks to sell the businesses to British Land last year, was thought to be seeking a price closer to £100m for Aberdeen Property Investors and its international sister company APII. But AAM chief executive Martin Gilbert says the aggregate cash sum paid by prop-erty fund advisers ...

  • ABI aiming to replace projections with risk tier system

    8 Apr 2004

    The Association of British Insurers is designing a series of proposals which would overhaul the disclosure regime. The proposals, which will be submitted to the FSA in June, would replace the current projection regime, which sets out a range of returns that consumers can expect on their investment products. A source close to the ABI's projection and disclosure working group says proposals are being put together which would see the time period for projection rates reduced ...

  • An inspiration to us all

    8 Apr 2004

    It is with much sadness that I read of the death of former IFA Chris Perrott. He was an inspiration to us all because, in the face of extreme illness and suffering (in 1997 he was given a year to live when diagnosed with multiple myeloma, a bone marrow cancer which destroyed both his kidneys, causing him to be on dialysis) he continued to promote the sale of criticalillness contracts through his charity, which raised money towards new equipment and to assist those critically ill. He ...

  • Bankhall teams up with HOL

    13 Apr 2004

    Bankhall protection arm Point One and health insurer Health-on-Line have teamed up to provide the first PMI service in the UK which allows advisers to submit business directly to the provider via Health-on-Line's new e-submission service called Choices. Health-on-Line's PMI plans allow the selection of benefits from a range of options letting the client and the adviser tailor-make their own plan according to budget and needs. Choices is signatureless, paperless, easy ...

  • Base rate stays at four per cent

    8 Apr 2004

    The Bank of England's Monetary Policy Committee voted today to keep base rate at 4 per cent for another month.

  • Biggest house price gains outside southern England, says Halifax

    13 Apr 2004

    The 10 counties with the biggest house price gains over the past 12 months are all outside southern England, according to Halifax's regional index. Four are in Wales - Gwynedd, Dyfed, West and Mid-Glamorgan - while two - Dumfries & Galloway and the Highlands - are in Scotland. Three are in the North - County Durham, Cumbria and Cleveland - with North Humberside and the Humber making up the remainder. All saw house prices rise by at least 30 per cent.

  • Bill of fare

    8 Apr 2004

    Expectations of significant and mostly unwanted change impacting on the financial services industry were extremely high ahead of this year's Budget. So what did we get? Well, quite a lot, resulting in substantial scope for effective communication with key clients. The foundation stone for the renewed attack on tax avoidance appears to have been laid in the shape of proposed disclosure rules aimed at the promoters of potential tax-avoidance schemes and designed to provide the ...

  • Blue sky thinking

    8 Apr 2004

    Britons are escaping to foreign shores in their droves. Around 2.3 million British citizens over 50 plan to retire abroad in the next 10 years, according to an Alliance & Leicester International survey, and it is estimated a further four million will be living as expatriates by 2020. In my experience, advisers working in this area often produce more business per case than an average UK adviser. But there are few advisers in the UK trained and able to provide clients ...

  • Bosses back pension schemes

    8 Apr 2004

    Over three-quarters of company senior executives want their employees to reach retirement age with adequate retirement savings, according to a CBI/Mercer pension survey. The poll of 233 companies across the UK found that 80 per cent of all senior staff in all sizes of firms agreed they want employees to have sufficient savings for retirement. But there was a split between big and small firms about the importance of schemes, with 73 per cent of executives at big firms convinced ...

  • Brave new fund world

    8 Apr 2004

    Gavin Haynes, investment director, Whitechurch Securities, Juliet Schooling, head of research, Chelsea Financial Services The FSA's new more flexible regime for authorised collective investment schemes replaces a prescriptive and overly detailed regime containing too many rules while maintaining a robust regulatory environment. The changes should mean that the UK becomes a more attractive domicile for funds. But there is one important proviso - to ensure that the new regime ...

  • Brickbats and mortar

    8 Apr 2004

    HBOS chief executive James Crosby went against what is arguably one of the biggest new trends in retirement saving last week when he argued that equities are a more suitable investment for pensions than property. For the head of the UK's biggest lender to talk down property as an asset class reflects more than just HBOS's desire to sell more investment products than rival Aviva. After 10 years of steady growth in house prices, Crosby doubtless feels that the ride ...

  • Broker accuses Halifax of complacency over mortgages

    8 Apr 2004

    A leading mortgage broker believes Halifax is becoming complacent by failing to price its mortgages aggressively, knowing that business will still come walking in the door. Hamptons International Mortgages technical director Jonathan Cornell says Halifax's recent pricing has not been great as it knows that business inflows will continue but it does not want to have to buy the business. When HBOS presented its annual results in February, chief executive James Crosby ...

  • Broker urges FSA to unlock its guidance over pensions

    8 Apr 2004

    FSA guidance against unlocking pensions is becoming increasingly difficult to justify because of falling annuity rates and moribund performance in closed funds, according to a pensions expert. The annuity rate for a single 65-year-old today is around 6.5 per cent, significantly lower than the 6.7 per cent rate for a 60-year-old 18 months ago, so Richard Jacobs Pension & Trustee Services director Richard Jacobs says taking pension benefits early can make sense. Jacobs ...

  • Bupa - Bupa Dental Plan

    13 Apr 2004

    Type: Group healthcare cash plan for dental coverMinimum premium: Dependent on group size and age of employeesMinimum group size: ThreeMinimum-maximum ages: 18-no maximumCover provided: Up to two examinations a year, up to two scale & polish treatments a year, x-rays, fillings & root canal treatment, extractions, crowns, bridges & denturesMaximum benefit: Routine dental treatment - level one £500 a year, level two ...

  • Bupa revamps dental plan

    7 Apr 2004

    Bupa has simplified its corporate dental plan to make it easier for IFAs to sell and easier for employees to understand..The previous version of the plan had six levels of cover and enables employees to choose from a select number of dentists. This version has two levels of cover and enables employees to visit any dentist registered in the UK.The plan is available to businesses with at least three employees and offers benefits for routine, remedial and overseas emergency ...

  • Bureau is changing to get ready for new annuity era

    8 Apr 2004

    The Annuity Bureau is restructuring its annuity services in anticipation of a new era for the annuity market and is also bringing sister company The Drawdown Bureau into its fold. The Annuity Bureau expects that once the Finance Act has been completed, the pension annuity market will open up and offer new products. It is setting up three new services and lowering its minimum pension fund size to £20,000. The first service, a self-select annuity service available ...

  • Canada Life closes income protection

    7 Apr 2004

    Canada Life is to close its doors to new individual income protection business at the end of the month following disappointing sales. The life office will continue to issue quotes until April 16 but with a guaranteed period reduced to 15 days. New applications will be accepted until April 30 with the aim of completing pipeline business by June 30. Income protection formed less than 1 per cent of Canada Life's total new business last year.

  • Children's Mutual in admin deal with Capita

    8 Apr 2004

    The Children's Mutual has picked Capita to administer its existing services portfolio and new child trust fund accounts. It is planning to market its own CTF accounts and to provide products and admin services for other financial services organisations in partnership with Capita. Capita is to invest £2.5m in customising technology to create bespoke admin and customer service infrastructure for the CTF accounts and will recruit 100 staff for admin. A significant ...

  • CML fears high cost of mortgage regulation

    8 Apr 2004

    Mortgage regulation could end up costing much more than the FSA's original estimate of £136m, according to the Council of Mortgage Lenders. The CML believes the FSA has significantly underestimated the cost of regulation. It is in favour of regulation but says the process needs to be proportionate in cost-benefit terms. It says the ultimate financial costs of the change cause it "some trepidation". Mortgage regulation is set to start at the end of October and ...

  • Conference is a critical success

    8 Apr 2004

    John Joseph Financial Services says its first IFA critical-illness sales and marketing conference was such a success it is organising a second event. Managing director John Joseph says 44 IFAs attended the first conference recently and he intends to announce the date for a second critical-illness conference in his Money Marketing column next week. Representatives from Best Doctors and the Special Risks Bureau attended the Bupa-sponsored event. With 126 different ...

  • Consolidate or lose advantage, Tenet warns IFAs

    8 Apr 2004

    Tenet Group chief executive Simon Hudson has issued a stark warning to rival IFAs, saying that the sector risks losing its competitive advantage if it does not consolidate faster. Writing in Money Marketing this week, Hudson says increasing costs and volatile consumer demand have made sales management and growth the primary concern of IFA businesses. He believes these pressures will increasingly force IFA firms to join networks or consolidate to remain profitable. Hudson ...

  • Consolidation street

    8 Apr 2004

    People in our industry talk a lot about consolidation among asset managers although there are few signs that this is happening. Personally, I prefer to focus my business on running money effectively and developing client relationships rather than committing valuable time to deciding where we can buy assets from somebody else. I believe that long-term success or failure in active management comes down to listening to clients and delivering targeted products that meet their needs. ...

  • Correspondent's week

    8 Apr 2004

    It is more than five years since I began tracking the tragic tale of the oldest life insurance company in the world, having first begun plotting its downfall as a reporter for Money Marketing. One might expect that, by now, new Equitable Life angles would be harder to find than an honest industry guarantee backed up by sound regulation. Sadly, not so. Following a train ride to Norfolk, I am greeted at the door by a woman who is understandably taken aback by my arrival. "He's ...

  • County Mortgages - No Income Declaration Mortgage

    8 Apr 2004

    Type: Self-cert tracker mortgageTracker term: Lifetime of loanTracker rate: Up to 90% of valuation - 1.99% above Bank of England base rate, up to 85% of valuation - 1.74% above Bank of England base rate, up to 75% of valuation - 1.49% above Bank of England base rateMinimum loan: £25,001Maximum loan: Up to 90% of valuation subject to a maximum of £500,000Income multiples: Based on affordability ...

  • Crombie determined to see job through

    8 Apr 2004

    Standard Life chief executive Sandy Crombie has defended his record, saying the board has asked him to take a demutualisation vote to members and he intends to do so. Despite Crombie and other Standard directors coming under fire from policyholders at the insurer's annual general meeting in Edinburgh on Tuesday, in an interview with Money Marketing he rejected questions over his leadership. Speaking just a week after Standard announced its intention to put a demutualisation ...

  • Endowment clients misled on shortfalls

    8 Apr 2004

    We fully agree with Robin Hunter's letter regarding with-profits, Target has been hit (Money Marketing, March 25). The present system being used by some with-profits life offices - shortfall warning letters - can misinform and mislead clients. We have carried out many reviews for clients who have received such warning letters from the with-profits offices. In many cases, when we check the bonus certificates, we have discovered that in fact the basic sum assured ...

  • Equity-release plan rates will reflect mortality risk

    8 Apr 2004

    Long-term care and retirement annuity specialist PAFS is planning to set up an impaired-life equityrelease product with interest rates and loan to values which vary to reflect the client's mortality risk. PAFS says the product will benefit clients who face a retirement which is likely to be shortened by ill health and who want to release the value in their homes. The firm says the product - to be launched in September - will benefit clients taking early retirement ...

  • Ex-B&W chief executive John Burke dies

    7 Apr 2004

    Former Bristol & West chief executive and vice chairman John Burke, OBE, died suddenly last week aged 62. Burke joined B&W in 1964 as a branch assistant in Plymouth and swiftly rose up the ranks, becoming chief executive in 1993. He enjoyed considerable success - introducing B&W's strategy to focus on mortgages, savings and investments - before stepping down from his role in 1999. He remained vice chairman until May 2001.

  • Exclusive Connections - Stepped Discount Mortgage

    7 Apr 2004

    Type: Stepped discounted-rate mortgageDiscounted term: Until December 1, 2006Discount: % until March 1, 2005, 1% until December 1, 2006Payable rate: 5%Minimum loan: £25,001Maximum loan: Up to 90% of valuation subject to a maximum of £1mIncome multiples: Up to 3.5 times principal income plus second or 3 times jointConditions: Available on self-certification basis, available for buy-to-let ...

  • Finance Bill creates six pension regimes

    13 Apr 2004

    The Government's tax simplification project has created six different regimes rather than one says PricewaterhouseCoopers.Commenting on the publication of the Finance Bill last Thursday, PricewaterhouseCoopers says that rather than one regime, the rules create six - registered schemes, employer-financed retirement benefit schemes, overseas recognised schemes, overseas unrecognised schemes, Section 615 schemes and corresponding accepting schemes.PricewaterhouseCoopers ...

  • Former AMP companies bounce back in the second half of 2003

    8 Apr 2004

    HHG, owner of Henderson, Pearl, NPI and Towry Law, saw a recovery in the second half of last year. Henderson's business was up by 46 per cent in the second half compared with the first half while HHG's other main business, Life Services, recovered from a £40m loss in the first half to £121m profit in the second half. However, HHG made an overall loss of £864m for last year due to restructuring and write-offs, following a £343m loss in 2002. Assets ...

  • Fowler calls for grants to aid pension victims

    8 Apr 2004

    Lord Fowler is calling for the Government to offer a series of grants to the victims of pension scheme wind-ups. Speaking in the Lords last week, the former Tory party chairman called for positive action to address the problems facing 60,000 pensioners whose company schemes have folded. He reminded the Lords of the compensation awarded to railway workers through his 1980 Transport Act when it became clear the British Rail fund had a substantial deficit. Fowler ...

  • FSA blocks BBB bid to ditch liabilities

    8 Apr 2004

    The FSA has blocked Berkeley Berry Birch's bid to dump the liabilities of its national IFA shell in a move which could throw into question the merger between BBB and Inter-Alliance. The regulator says its decision to halt the transfer of Berry Birch & Noble Financial Services' business to BBN Financial Planning is a precautionary measure pending its review of transactions that happened before the liquidation. As reported in Money Marketing two weeks ago, the ...

  • FSA finalises plans for 'flexible' exam switch

    8 Apr 2004

    The FSA has finalised proposals to move from approved to appropriate exams, saying the change will lead to "greater flexibility" for firms in deciding which exams staff should take to be deemed competent. The regulator and the Financial Services Skills Council have agreed a memorandum of understanding, outlining the future of the two bodies' relationship. The changes will not take effect until the skills council has obtained its full licence and has published a list ...

  • FSA sets out framework for electronic reporting

    8 Apr 2004

    The FSA has introduced regulations that will compel IFAs to file regulatory returns electronically and provide detailed information about their firms on a six-monthly basis. The regulator will use the information about firms' financial health and business activities to monitor compliance and identify trends in the sector. IFAs are split over the introduction of the new requirements. Some complain that compiling all the information will be arduous but others say they ...

  • Future imperatives

    8 Apr 2004

    The threats we face in the market are numerous, from rivals' aggressive behaviour to hardening consumer attitudes towards financial planning and products. Our historic core activity has been to act as a service provider to IFAs. The service which IFAs have traditionally bought has been the authorisation to give financial advice through the network. This service was typically paid for by enhanced commission terms. Our service has expanded to include compliance consultancy ...

  • Gear up for big changes in pensions

    8 Apr 2004

    Pension advisers will get the chance to quiz the experts on the future of the industry at this year's Money Marketing Live conference and exhibition. A pension panel debate, Gearing up for A-Day, will be a keynote feature of the conference, which will be held at Olympia, London, on May 6. Panellists will include independent expert Ros Altmann, Informed Choice managing director Nick Bamford, Millfield Partnership pension specialist Graham Duckett and Clerical Medical ...

  • Gender basis ban gets go-ahead from MEPs

    8 Apr 2004

    A ban on underwriting insurance products on the basis of gender moved a step further while an amendment to protect execution-only business was approved in two separate European Parliament votes last week. The gender equality directive was approved by MEPs. It will prohibit underwriting life and general insurance products and annuities on the grounds of gender. UK insurers are lobbying for insurance products to be exempt from the directive which is generally accepted will ...

  • Ghiloni set to leave Britannic

    7 Apr 2004

    Britannic Asset Management sales and marketing director Francis Ghiloni is leaving the company after 21 years. Ghiloni, 44, is unsure what his next move might be but says he wants to leave now as it could be harder for him to find another major position in a few years' time. He plans to spend his six-month notice period considering his options, which he says may not necessarily lie within financial services or asset management.

  • Gunther seeks the holy grail of flexible tenure

    8 Apr 2004

    The development of low-cost homeownership in the private sector would make a huge difference to frustrated first-time buyers, according to Council of Mortgage Lenders' chairwoman Anne Gunther. Speaking at the CML's annual lunch last week, Gunther asked why a lender should have to repossess a home in the future if there was an alternative to move a borrower in difficulties on to a part-ownership status. She described flexible tenure as the "holy grail", which means ...

  • Halifax Building Society - First Time Buyer 5-Year Fixed Rate Cashback Mortgage

    8 Apr 2004

    Type:Fixed-rate mortgageFixed term: Until July 31, 2009Fixed rate: 5.99%Minimum loan: £1Maximum loan: Up to 97% of valuation subject to a maximum of £150,000, up to 95% of valuation subject to a maximum of £250,000, up to 90% subject to a maximum of £500,000, up to 85% of valuation subject to a maximum of £2m,up to 75% of valuation subject to no maximumIncome multiples: Based on ...

  • High on the China wave

    8 Apr 2004

    The US has the biggest economy in the world and it is traditionally perceived that other countries rely on it rather than the other way round. However, there is one country that has made an explosive entry into the group of major global economies and which is having a significant impact on the US economy and equity market. That country is China. The rapid industrialisation occurring in China is having phenomenal ramifications throughout the world and is a significant ...

  • Independent view

    8 Apr 2004

    Pension misselling and endowment misselling - what went wrong? The problem is that, unfortunately, our industry is sales-driven. Yes, we can give euphemistic titles to salesforces but nonetheless they are salespeople. If you look at any industry which is sales-driven, it equates to high commission, inappropriate and complicated products and no after-sales service. Double-glazing, timeshare, Arthur Daly - need I say more? The problem with financial products is that all ...

  • Investment

    8 Apr 2004

    Most of the world's equity markets rose sharply last week, with aggressive buying on Friday afternoon following the release of the latest US employment numbers which came in way ahead of expectations. By the end of the week, the FTSE World index had risen 2.9 per cent, taking its gain since the start of the year to 3.7 per cent. In the UK, shares ended the week higher, with blue-chip stocks leading the way following a gain of 2.5 per cent for the FTSE 100. It was also another ...

  • Investment view

    8 Apr 2004

    Things are looking up! Not only were markets perkier last week, but I now have my copies of the Barclays Capital equity/gilt study and the Fortune 500 list of America's biggest companies. Lists like the Fortune 500 and studies such as Barclays are valuable when it comes to looking at what is happening in markets and putting it into an historical context and it becomes clear, too, that statistical information is more subjective than you might expect. Take the Fortune ...

  • Isa boost for IFAs

    7 Apr 2004

    Isa season cash inflows rose on average 16 per cent in the IFA sector according to a survey by Prudential. The research shows 59 per cent of IFAs feel their clients have a more positive attitude to investment risk compared to this time last year, while only 14 per cent describe their clients as being more cautious.

  • ISIS launches second property fund

    8 Apr 2004

    Isis Asset Management is launching a second property trust. ISIS Property Trust 2 will be a Guernsey exempt investment company that will invest in UK commercial properties. ISIS Property Asset Management managing director Paul Herrington says IPT2 will acquire an existing set of properties that we manage for a number of clients.

  • Julian Gibbs

    8 Apr 2004

    One bit of good news in the Budget should help the venture capital sector attract more money. The Chancellor has increased income tax relief on investments from 20 per cent to 40 per cent for 2004/05 and 2005/06. Furthermore, the personal investment limit will increase from £100,000 to £200,000 in any tax year. The income tax relief is paid direct to the investor rather than to the VCT as indicated in the pre-Budget report. However, capital gains tax deferral ...

  • Kelly gives pledge on Miles' report

    8 Apr 2004

    The Treasury is planning a consultation on Professor David Miles' recommendations for the mortgage market. Speaking at the CML's annual lunch, Treasury Financial Secretary Ruth Kelly said she fully endorsed Miles' conclusion that the mortgage market needed urgent reform. Industry bodies initially criticised Chancellor Gordon Brown for skimming over Miles' review in the Budget, but Kelly's ann-ouncement will go some way towards appeasing groups that feared ...

  • Kevin Duffy on mortgages

    8 Apr 2004

    Three things struck me at the recent Money Marketing awards dinner. First, the Rolling Stones wrote some truly iconic music that cannot be easily imitated. Second, after-dinner speaking to IFAs is nothing less than a mental assault course if your material has not been updated. And third, predicting award winners is an impossible task. Take Standard Life, voted Company of the Year. I wonder whether its policyholders can fathom why. If the capital-adequacy debacle was not enough, ...

  • L&G capital protection plus 3 closes this Friday.

    13 Apr 2004

    Investors have only four more days to invest in Legal & General's capital protection plus 3 product, which closes to new business after 5pm this Friday.The product is described as good for cautious investors wanting security in their investment and offers capital protection at maturity if the FTSE 100 index falls.It also pays out a minimum 22 per cent at maturity if the FTSE 100 falls and pays out half of any growth in the FTSE 100 over the investment period if greater.

  • LIA looking to fill chairman role

    7 Apr 2004

    The LIA has announced it is seeking high-calibre candidates for its newly created role of chairman. The position will involve assisting with the strategic direction of the board in additional to an ambassadorial role aimed at boosting the LIA's profile in the wider financial community. The chairman will work alongside the president, who will continue to fulfil a member-facing role, and director general Mark Oomanney.

  • Life policyholders facing penalty in IHT crackdown

    8 Apr 2004

    Life insurance policyholders with money held in trusts could be penalised by the Chancellor's latest measures to toughen up on inheritance tax avoidance. Gordon Brown's 2004 Budget includes tighter restrictions for investors using complex double-trust schemes to escape IHT. The schemes allow an investor to carry on living in their property while having given the bulk of its value away for inheritance tax purposes. The Treasury is clamping down on the loophole, ...

  • Lifesearch critical of Direct Line campaign

    8 Apr 2004

    Protection specialist Life-Search has slammed rival Direct Line for encouraging consumers to trade in their critical-illness policies for cheaper new cover. Lifesearch believes Direct Line's television advertising campaign is misleading consumers, encouraging them to replace their existing cover with cheaper policies. Lifesearch senior technical adviser Kevin Carr says selling critical-illness cover on price alone is wrong and that newer policies are often not the ...

  • LMS takes on branded lending for Mortgages plc.

    13 Apr 2004

    LMS Homeloans is going to offer branded lending for Mortgages plc. LMS Homeloans already offers branded lending with Platform Home Loans mortgage products and says it intends to offer its branded lending activities with further lenders in the future.

  • Lord Abbett carves niche

    13 Apr 2004

    LORD ABBETTCF LORD ABBETT UK GROWTH & INCOME FUNDType: Oeic Aim: Growth and income by investing in larger UK companies Minimum investment: Lump sum £1,000, monthly £50 Investment split: 23.57% financials, 11.92% energy 11.63% consumer staples, 11.57% healthcare, 11.56% telecommunication services, 10.09% consumer discretionary, 8.98% utilities, 4.2% materials, 1.85% information technology, 4.63% cash Isa link: Yes ...

  • Massive PI run-off excess shocks ex-DBS member

    8 Apr 2004

    A former DBS member has been stunned by a 10-fold increase in his professional indemnity insurance excess in the two years since he left the Sesame subsidiary. York FM director Graham Carver contacted DBS after leaving to find out where he stood and was told he would not need PI run-off cover. At that time, his excess was £2,000. He still has PI run-off cover but his excess has soared to £20,000. Carver says a claim against him could force his new firm into ...

  • Mortgage facts posted on the net

    8 Apr 2004

    Moneyfacts is setting up an internet portal for IFAs that will offer an information service and online quotes. It will include a mortgage sourcing service, which the company says will cover all products from all lenders. The site will give users access to an area that lets them view full commission details, a mortgage compliance centre and daily product selections. It will offer searches on savings and credit cards and links to partner sites 1st Software and ...

  • Mutual life after Standard

    8 Apr 2004

    The move by Standard Life to demutualise is a blow to UK investors and to IFAs. It limits choice and will hasten the pace of consolidation even if, for the moment, Standard remains independent. No one should be surprised about the board's decision to recommend a move to plc status. The FSA's insistence on changes to the way the with-profits fund was run probably made it inevitable. Standard itself argues that, with the percentage of customers in the with-profits fund falling ...

  • New code for home reversion

    8 Apr 2004

    Safe Home Income Plans is working with Sofa and Aifa to develop a guide to help intermediaries offer advice on home-reversion schemes if the sector is not regulated. Ship is concerned that home reversion will not come under the rule of the FSA before mortgage regulation starts in October. It is working on a new code of practice to look at the compliance regime and the role and powers of arbitrators to ensure consumer protection. Ship is also looking at introducing ...

  • New firm offers to fight complaints against advisers

    8 Apr 2004

    A new company is aiming to help defend IFAs against complaints from private investors. Financial Interest says it will offer an expert approach to the construction of complaint letters. It claims that IFAs can cut the potential cost of a complaint by outsourcing it to the firm's team who will research their case. It says it will assess most complaints for a fixed fee of £100 and will act for an IFA for £75 an hour. The firm says it can offer expertise ...

  • Numbers up for actuaries

    8 Apr 2004

    Clerical Medical's irrepressible Gordon McAra was overheard at a dinner boasting of a prophylactic past to rival his stellar career in public relations. It seems that as treasurer of the Students' Union at one of Scotland's finest universities, Heriot-Watt, McAra was responsible for the installation of condom machines in the toilets in the 1970s. Given that one of Heriot-Watt's specialities was actuarial science, McAra could well have saved Scotland from a ...

  • Old Mutual Asset Managers - Old Mutual Asia Pacific Equity Fund

    7 Apr 2004

    Type: Hedge fundAim:Growth by investing in companies in the Asia Pacific region with a market cap of above $500mMinimum investment: Lump sum £100,000, $100,000, euros 100,000Investment split:100% in companies in the Asia Pacific regionPlace of registration: Cayman IslandsCharges: Annual 1.5%, performance fee 20%Commission: NoneTel: 0808 100 2715

  • Out of context

    8 Apr 2004

    •"We had these season tickets for Tottenham Hotspur but they hadn't scored for ages and we could not pay brokers to go along." - PAFS general manager Mike Douglas. •"It's easier to find an elephant in Harrods than for me to send an email." - John Malone of Premier Mortgage Services on trying to get to gets to grips with the internet age. •"Well, it's certainly not Wuthering Heights." -Aifa director general Paul Smee summarises the FSA's latest ...

  • PAFS flexible care account relaunched to plug gaps

    8 Apr 2004

    The Pension Annuity Friendly Society is relaunching its flexible care account this year to fill gaps in the prefunded long-term care market following the withdrawal of other providers. The account, which was set up last year, combines insurance and investment elements operating independently. It is designed to build a fund towards some initial care requirements, with nursing care insurance to pay for more expensive care. PAFS says PPP and Norwich Union's withdrawal ...

  • Paton to join Henderson tech team

    8 Apr 2004

    Henderson Global Investors has appointed Abbey National's head of North American equities Geoff Paton to its technology team, with global tech fund manager Paul Kleiser poised to announce his retirement. Paton, who managed two tech funds for Abbey National Asset Managers, including a unit trust ranked third in its peer group over the three years to November 2003, will join the group in August. He is expected to replace Kleiser, co-manager of Henderson's £325m ...

  • Personal wealth on the rise

    7 Apr 2004

    Average personal wealth in the UK has risen to £82,400 from £74,234 in 2001 according to IBM's annual personal wealth index. The consultant is calling for banks to provide better service for their asset-rich consumers, saying people are relying more on property instead of liquid assets in their investment portfolios.

  • Pink's Crystal tips into advsrse credit

    8 Apr 2004

    PINK HOME LOANSCRYSTAL LIGHT ADVERSE BUY-TO-LETType: Discounted rate adverse credit buy-to-let mortgageDiscounted term: Until August 31, 2005Discount: 2%Payable rate: House purchase 5.35%,remortgages 5.6%Minimum loan: £25,001Maximum loan: Up to 80% of valuation subject to a maximum of £500,000Income multiples: Rental income must be at least 130% of mortgage repaymentsConditions: ...

  • Place bet

    8 Apr 2004

    The Diary assumes that insurance is a far cry from the frenzied world of gambling and spread betting. But not if one were to read the launch edition of betting magazine Inside Edge, edited by James Hipwell, previously co-author of the Daily Mirror's City Slicker column. What is this we read in the letters page? A certain Philip Martin of Edinburgh writes to ask for information on factors affecting spreads, state of the pitch, likely side in football - eh? - and experts' ...

  • Portman warning equity release is the last resort

    8 Apr 2004

    Portman Building Society director Matthew Wyles says equity release should be seen as an option of last resort for consumers, arguing that advisers should first consider all other avenues for elderly clients looking to raise capital. Wyles says he believes there are a number of opt-ions that should be ruled out before equity release is discussed, the most obvious being trading down to a smaller home. However, Wyles points out that despite the risks involved, equity release ...

  • Product Matters

    8 Apr 2004

    The only reason for Scottish Equitable's flexible pension plan contract is to line the pockets of insurance companies and advisers, not to unbundle costs, as suggested. I suspect it was put together by Scottish Equitable and a high-volume IFA. It is wrong to say the client cannot win but certainly the insurance company and the adviser cannot lose. All the facilities offered with this product are available in the marketplace. If a client does not require investment ...

  • Pru sets theme and doubles external funds

    8 Apr 2004

    Prudential is boosting its external fund link range from 19 funds and three managers to 44 funds with a choice of six managers. The new range sees 18 funds from Barclays Global Investors, Baillie Gifford, Newton Investment Management, Northern Trust Global Investments and UBS Global Asset Management funds offered alongside 26 funds managed by Prudential's own investment arm M&G. The Prudential Portfolio Management Group will actively monitor the performance and ...

  • Regulatory 'creep' under scrutiny

    7 Apr 2004

    The Cabinet Office is conducting a review into the Financial Ombudsman Service in addition to that already being carried out by the Treasury as part of its two year review of the Financial Services and Markets Act. The Cabinet Office's Better Regulation Task Force is looking at the function of the FOS as part of its investigation into regulatory 'creep'. The BTRF defines regulatory creep as 'regulation or compliance that goes beyond its original source of authority'. ...

  • Reid all about it

    8 Apr 2004

    Mayor of London Ken Livingstone and Metropolitan Police Commissioner John Stevens recently told Londoners that the threat of a terrorist attack is closer than many may think. "It's not a question of if but when." The phrase should have been the stock response when clients asked whether Standard Life would ever demutualise. My attitude to with-profits is hostile and this, perhaps, has coloured my view of providers who stick with this investment option, despite its failings. Gi

  • Releasing income

    8 Apr 2004

    I thought that the requirements of the client in the recent Best Advice column in Money Marketing were clearly stated. She was 70 years old and was finding it hard to cope financially since the death of her husband, who had a predominantly pension-based income. Her home was worth £500,000 and the question was, could releasing income from her home be the answer? The advice given discussed mainly the inheritance tax implications of releasing a lump sum and investing ...

  • SLI plays it safe

    13 Apr 2004

    Scottish Life International has designed a capital-protected bond that has no fixed term.The safe combination bond invests in a combination of two capital-protected funds - UK Protected Index 100 % fund and UK Protected Index 95% funds. These funds are linked to the performance of the FTSE 100 and offer different levels of return to match the degree of capital protection.The returns from the underlying funds are variable on a quarterly basis. For the quarter beginning ...

  • Standard Life clients question timing and accuse FSA

    8 Apr 2004

    Standard Life escaped serious criticism at its AGM on Tuesday over its support for demutualisation but policyholders have questioned the timing and whether it should have been done in 2000. A policyholder at the AGM in Edinburgh said: "Four years ago, you were determined to have mutuality as an almost absolute worship and you are now being dragged kicking and shouting into demutualisation." Policyholders also turned on the FSA, criticising it for "forcing" the company ...

  • Standard Life edge

    8 Apr 2004

    The news that Standard Life has made the crucial decision to demutualise comes as no surprise to many people. It seems that the move was inevitable following its recent spat with the FSA over the introduction of the new realistic reporting regime. The disagreement arose over Standard's inclusion of future profits in its balance sheet and the FSA has made it clear that it does not want future profits counted in its new solvency regime. To be fair, Standard resolved the matter ...

  • Standard life edge

    8 Apr 2004

    Long-time favourite of the IFA community, Standard Life has finally capitulated to what many saw as the inevitable but only after it was pressurised into doing so by the FSA. The Government's embarrassment over the Equitable Life fiasco was never going to allow a similar problem again and Standard Life has ended up as the whipping boy. Ever since the Baird report, the writing was probably on the wall if anyone took long enough to read it. The FSA report made a number ...

  • Standard will not sell subsidiaries

    8 Apr 2004

    Standard Life says it has no plans to sell Standard Life Bank, Standard Life Healthcare or Standard Life Investments as part of its move towards flotation. The update on the strategic review describes the businesses as profitable and capital-sufficient. It says they are growing well in challenging markets and have demonstrated robust plans for future growth. Standard Life Canada will be retained and developed but plans to launch a new business in France have been put ...

  • Stronger Equitable hands out bonus

    8 Apr 2004

    Equitable Life with-profits policholders are to get interim bonuses and the company says it is in better condition than at any other time in recent years. Equitable is carrying out a strategic review into its long-term future, which is believed to include the aim of going back into equities and the option of being put up for sale. In the society's preliminary results for 2003, the company reveals an interim non-guaranteed bonus of 2 per cent for with-profits pension ...

  • Talkback

    8 Apr 2004

    "No. Both are equally appropriate, depending on clients' circumstances and attitude to risk." Tim Purdon, Paladin Financial Services "Yes, property can be a difficult investment to realise." Alan Smith,Adrian Smith & Partners "Yes - at the moment, property is a bandwagon and usually by the time you have seen a bandwagon you have missed it." Alex Campbell,Campbell Harrison "Yes, I firmly agree. Clients need to diversify their portfolio but they ...

  • Tech firm says release is a major opportunity

    8 Apr 2004

    Life and pension providers are missing a huge opportunity if they stay out of the equityrelease market, according to Marlborough Stirling. The technology firm, which last week set up the industry's first equity-release trading platform, has written to life and pension providers telling them they should be taking advantage of the trend for the growing elderly population to release equity from their homes to fund retirement. Marlborough Stirling says that although the ...

  • The strategy stays the same, says new Newton higher-income fund chief

    8 Apr 2004

    Newton's new higher-income fund manager says it will be investment business as usual for the £1.4bn portfolio following the departure of Clive Beagles to JO Hambro Capital Management. Tineke Frikkee, Beagles' former deputy, says she has no plans to alter the fund, insisting that every stock is there because she has sanctioned its inclusion. She says there will not be even a minor adjustment such as when Beagles took over from Toby Thompson in 2001 and removed the convertible ...

  • The true position on distribution

    8 Apr 2004

    As we enter the new tax year, the tax relief on Isa income will be abolished. In anticipation of this and, in our view, mistakenly, many fund management houses have been suggesting distribution funds as a means for investors to protect themselves against this change. Distribution funds - funds with more than 60 per cent of the assets invested in bonds - have been considered by some as tax-efficient, as all the distributable income can be distributed as interest payments. Investors ...

  • Tilney provides first step to hedge funds

    8 Apr 2004

    Tilney Investment Management has designed a capital-guaranteed fund of hedge funds that has a term of five years and one month. Opal Optimum Tailored Solutions invests in the Opal Optimum Master Fund, a hedge fund of funds mirroring the Opal Optimum Strategy Fund.The product has a term of five years and one month because this makes it Isa-eligible under the new regulations. Investors can put as little as £5,000 into the product through an Isa, but for direct investments ...

  • Tomas Carruthers

    8 Apr 2004

    The glory days of the 1990's technology boom might seem a world away but after an absence from the limelight, Tomas Carruthers, the one-time chief executive of Interactive Investor International, is making his move back into the marketplace. Carruthers has again taken the reins of the consumer fund supermarket Ample and will be developing it into a wrap platform - to be rolled out to IFAs. Last month, Carruthers bought Ample from AMP in a move that is a sort of homecoming ...

  • United plea to Treasury for reversion regulation

    8 Apr 2004

    Representatives from seven leading industry, consumer and pensioner bodies are urging the Government to regulate home-reversion plans. Last November, the Treasury announced a consultation into whether home-reversion plans should be regulated along with lifetime mortgages. It was criticised at the time for overemphasising the costs of regulation while skirting over the protection of consumers. The consultation closed at the end of January and concern has been expressed ...

  • Venture forth

    8 Apr 2004

    I am a higher-rate taxpayer who has maximised all the tax-efficient investments that I am aware of. I have previously stayed away from venture capital trusts due to the volatility in the stockmarkets. Should I now consider them as I am willing to adopt a higher risk/reward strategy for part of my portfolio? Venture capital trusts invest in the shares of unquoted trading companies or fledgling companies. The range of company activities can be as far-reaching as technology to homebuilding.

  • Virtual Net set to buy up Burns Anderson

    8 Apr 2004

    Technology IFA Virtual Net is believed to be in negotiations to buy the Burns Anderson network, according to sources close to the discussions. Virtual Net, which has 320 RIs, acquired 170 Eurosure Investment Services advisers last September and is understood to be looking to complete its deal with BA in the next few months. News of the discussions come despite recent statements from BA that it was on the acquisition trail and looking at rival networks and IT offerings. Virtual ...

  • Watching the watchdog

    8 Apr 2004

    In my last few articles, I have discussed a number of important rulings from the Financial Ombudsman Service which give valuable pointers to the way in which financial advisers should - or should not - market and transact certain classes of business. The case studies reflect the way in which the FOS deals with complaints from clients and should be monitored closely by authorised firms, which might consider amending procedures to ensure that they will not be taken to task by this ...

  • Wesleyan cuts payouts despite 17% fund return

    8 Apr 2004

    Wesleyan Assurance is reducing payouts despite a return of 17.2 per cent on the with-profits fund in 2003. The company says it has more than four times the risk capital margin needed under the new realistic reporting regime. Conventional life and pension policies will see cuts of 0.25 per cent in the annual bonus on the sum assured and 0.75 per cent for life policies and 0.5 per cent for pensions on attaching bonuses. Annual bonuses on unitised with-profits products ...

  • Which types of policy should merit tax relief?

    8 Apr 2004

    Even simplification will still leave pensions as an essentially tax-relief-driven form of saving. The original intention of tax incentives on pensions was,of course, to save the state the cost of caring for impoverished old folk. The first Thatcherite Chancellor, Geoffrey Howe, stated that his aim was to produce fiscal neutrality between various forms of investment. But today, look at the tax treatment of various forms of protection policies. Take, for example, an employee ...

  • Which? mystery shops advisers in CI cover probe

    8 Apr 2004

    Consumer magazine Which? has been recording phone conversations with IFAs as part of a year-long investigation into potential misselling of critical-illness cover, Money Marketing has learned. The mystery shopping exercise looks at whether CI products have been oversold by intermediaries. Which? says the report, due to be unveiled on June 3, has not been completed and no conclusions have yet been drawn as to whether misselling has taken place. Which? media relations ...

  • WP balance sheet 'shows no cause for alarm'

    8 Apr 2004

    Industry experts say Standard Life's realistic with-profits balance sheet is in line with earlier estimates and shows no cause for alarm. The company submitted its realistic balance sheet to the FSA last week, on the same day that it announced it intended to push for demutualisation. The figures show a realistic surplus of £4.6bn, more than twice the risk capital margin, with assets available above liabilities and capital requirements standing at £2.5bn. Hargreaves ...

  • Wrap up the wealth

    8 Apr 2004

    AITC director general Daniel Godfrey believes that firms embroiled in the FSA's splits' investigation may be shooting themselves in the foot by shunning its collective compensation scheme over fears of litigation. He says if a fair compensation package could be thrashed out, not only would most potential claims fall away but those that did not would be looked upon unfavourably by the courts. Do you agree with him? Should firms try and draw a line under the problem? Scott: ...

  • ZAN plan to go multi-tied

    8 Apr 2004

    Zurich Financial Services is moving to completely remodel and rebrand the Zurich Advice Network to become a directly authorised multi-tie distribution business. Speaking to Money Marketing last week, global chief executive of the life business Paul van de Geijn, who took on the role five months ago, says the UK life business will be split into two parts - manufacturing and distribution. ZAN, which encompasses the former Allied Dunbar salesforce and is one of the UK's ...

  • Zurich Assurance - Zurich Guaranteed Account

    13 Apr 2004

    Type: Capital-protected bondAim: Growth linked to the performance of the FTSE 100 indexMinimum-maximum investment: £2,500-£250,000Term: Five years and six monthsGuarantee: Original capital returned in full regardless of performance in the indexReturn: Up to 100% growth at end of the term or 30% growth if index grows by at least 30% by the third anniversaryClosing date: May 24, 2004Commission: ...

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