View more on these topics

Anger over opt-out call for HNW clients

Advisers have hit out at the Treasury select committee for supporting the banking sector’s argument that high-net-worth clients should be able to opt out of the RDR regime.

In its report on the RDR, published last week, the committee notes concern from JP Morgan that non-UK funds will not bring their product structures in line with the RDR, potentially limiting products available to HNW clients or increasing their cost.

It also highlights points raised by Barclays, which argues that some measures in the RDR are inappropriate for the “competitive” HNW market which involves “internationally mobile clients” who are often more financially sophisticated than mass-market retail clients. The bank closed its retail advice arm in January amid plans to focus on its HNW proposition.

The TSC says: “We note concerns of firms that the RDR may have a deleterious impact on their ability to provide a full service to high-net-worth individuals. We recommend the FSA examines how to allow high net worth individuals, as determined by the FSA, the opportunity to opt out of the RDR. This should also mean they opt out of most or all protections that retail customers receive.”

The committee says the FSA should report back on the potential scale of the issue and whether the RDR could be modified to address these concerns.

Jonathan Fry & Co private wealth director Jonathan Fry says: “Banks do not want to discuss fees with their clients, especially with high-net-worth clients, where the fees can be very high, so this smacks of self-interest. If the banks get away with this, it will be quite a coup.

“The RDR is forcing many advisers to move towards the HNW area and if those clients are allowed to opt out, who exactly will the RDR apply to?”


Abbey launches two new one-week deals

Abbey for Intermediaries has launched two new key account exclusives which are available for seven days only. They include a two-year tracker at base rate plus 1.79 per cent up to 75 per cent loan-to-value. It is available for a £995 fee. It is also launching a five-year fixed rate mortgage at 4.99 per cent […]


Kensington doubles maximum loan size to £1m

Kensington has doubled its maximum loan size to £500,000 up to 90 per cent loan-to-value and to £1m up to 75 per cent LTV. In May, Kensington increased its maximum loan-to-value to 90 per cent and offered a limited tranche of lending through Legal & General Mortgage club. Before this, its maximum LTV was 85 […]

Govt must show how it will promote mutuals

A group of MPs is calling on the Government to urgently set out a plan for how it will meet the coalition agreement’s commitment to foster diversity and promote mutuals within financial services. A report published this week by the all party parliamentary group for building societies and financial mutuals, Fostering diversity: promoting mutuals, says […]


Listen to the Treasury select committee over RDR

The FSA should now listen to the (mainly) sensible and balanced report from Andrew Tyrie’s Treasury select committee and implement a delay to the introduction of the retail distribution review. Statistics show IFAs have already made great strides in recent years to improve qualification levels, with the majority expecting to reach the required standards by […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm