Standard Life to compensate all sterling fund investors at £100m cost
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Standard Life has announced that it will compensate all investors who lost out after the surprise revaluation of its pension sterling fund last month.
The insurer has vowed to restore the value of the fund - which was £2.4bn before the revaluation. This move will put each customer back into the position they would have been in before the almost 5 per cent drop in value, at a cost of over £100m to Standard Life.
The firm’s fund literature has been slammed in recent weeks, with advisers and investors claiming it did not clearly detail the assets the fund was invested in - particularly its hefty holding of mortgage-backed securities.
Standard Life accepts, after reviewing the literature, that many people were not fully aware of the nature of the fund and that some customers could not have anticipated that the value of their units could fall by such an amount in one day.
It admits that some of the literature “fell short” of the firm’s “high standards”.
Managing director of customer service John Gill says: “Standard Life would like to take this opportunity to apologise to any customers who have been affected by the fall in value of this fund.
“In hindsight, some of the literature supporting the fund fell short of our own high standards, and it is important that we put this right. We have listened to our customers and advisers and believe that our response underlines our commitment to our long-term relationship with them.”
Intelligent Pensions technical director David Trenner says: “Unlike Brian I am not a member of the Standard Life fan club. They thought they could get away with it, then they discovered they could not, so they back tracked.
“This is after all the company which runs a ’with profits’ fund with no guarantees and no bonuses and sells group Sipps to other employers but has a GPP for its own staff.”
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