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HSBC pulls plug on workplace pension arm

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HSBC has confirmed the withdrawal of its adviser-facing Workplace Retirement Services proposition less than three years after launch.

The global bank, which is the UK’s second biggest company with a market cap of £135bn, says it will no longer look to distribute corporate pensions through intermediaries.

Launched in November 2010, HSBC Workplace Retirement Services had vowed to become a leading pensions provider within five years. Its adviser distribution team has now been disbanded.

The provider had invested in a new investment-only platform, called Fund Platform, aimed at trust-based pension schemes offering straight-through processing, open architecture and access to HSBC’s target date Protected Retirement Funds.

The bank says it will still continue to offer an auto-enrolment proposition to its 1.2m business banking clients.

An HSBC spokesman says: “Following a review of the business we have made the decision to no longer distribute our service through external IFAs. However it is our intention to continue to offer our commercial banking clients a workplace pension proposition.”

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Readers' comments (4)

  • Another company pulls the plug. Pension companies are waking up to the fact that they will not be able to make money out of workplace schemes.

    Frankly, NEST is the death knell of the private pensions market. SIPPS have been a miss selling scandal waiting to happen. Having seen some of the outrageous charges on person pensions still being applied the whole market needs a radical shake up.

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  • I find it very sad that the financial services industry is being torn to shreds. I don't get how good quality pension planning cannot be profitable for companies or IFA's when there is such a huge demand. A study from Aviva in 2010 showed that the shortfall in pension provision in the uk is £300bn odd per year. Surely then it is the duty of decent advisors to assist people in understanding how pensions work, assessing what provisions they have, and helping them plan a comfortable retirement, whilst charging a fair and honest price for the work. I wish it were possible to reach out to the people of the uk and address all their financial needs in an honest and decent manner.

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  • Anon 10.39 I wish it were possible to reach out to the people of the uk and address all their financial needs in an honest and decent manner.

    I set up my own IFA practice with this in mind, it grew from 0 clients by 50% year on year for 3 years but the costs were just too high and I shut up shop.

    I concluded that in the end people would rather be told what they want to hear than hear the truth. There are too many IFAs who tell people what they want to hear, then charge them and arm and a leg for the pleasure. Most of my customers came to me from IFAs after they realised the had been told BS and charged for it. By the time they discovered the 'sellers' had moved on.

    With RDR people are now asking IFAs to work for virtually next to nothing. The public have been sold the wrong message yet again. With costs going up even more decent ifas will shut up shop and leave it to the cowboys with big trail commission coming in each month who can afford to pay the increasing costs of regulation and who are only interested in customers with lots of money, or pensions they can 'transfer'.

    The answer for 'ordinary' customers is financial education in schools and the internet. I tried to get involved with financial education in schools and it is run by charities who expect everyone to work for free. A waste of 20 years experience and QCF 4. I am now off to stack shelves.

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  • Unfortunately the end result of RDR is to provide the UK with a large pool of highly qualified unemployed people with extensive experience in the field of financial advice. How will that help?

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