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AMP retreat throws up several concerns Better than nothing

It always sounded just like so much hot air. AMP&#39s old UK strategy

relied on all manner of Government promises coupled with a huge doses

of wishful thinking. Great things were expected of low-cost sales

multi-ties and 1 per cent products. Other should take note. Now AMP

is retreating back to Australia, leaving something in the UK to be

known as Henderson.

But there are several concerns. First, the fate of Pearl and London

Life customers, many of them are now IFA clients whose savings are to

be managed in a cautious manner at a time when cautious assets may

not be appropriate. Second, we hope the credible parts of the

business such as Henderson and a recovering Towry Law do not see

their interests or credibility compromised by the need for AMP&#39s

swift exit.

The UK chief executive has taken some difficult but brave decisions

to save the company but he has a great deal still to do.

“Well, it&#39s better than nothing” has been the almost universal

reaction to Prudential&#39s compromise offer last week. It now also

seems that small IFAs as well as big organisations will benefit. It

would still be better if Pru had changed its mind on the whole issue.

They should have consulted not just their accountants but their

marketing and sales men and women.

It may still be underestimating the long-term damage the company has done to its

reputation. Of course, the decision will become irrevocable as IFAs

begin the task of rebroking. We shall see how far £75 stretches.

And what will the clients think?

The deal is better than nothing.

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