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Another Standard issue

Standard Life has certainly been hogging the spotlight recently – and not exactly in a positive way.

With the firm’s pension sterling fund shenanigans continuing, announcements about deferrals on its UK unit-linked life and pensions property funds and advisers having a pop at its new active money Sipp campaign, 2009 appears to have started badly on the pensions front for the newly knighted Sandy Crombie.

UK managing director of distribution Paul Matthews told Money Marketing this week that the firm was hauling in as much fund literature as possible to consider whether it may have crossed the FSA’s fair, clear and not misleading rules – something many advisers, investors and compliance consultants are claiming.

A document Money Marketing has seen, dated April 2008, stating the fund is “wholly invested in cash – the most stable investment” will I’m sure be cause for concern.

Matthews, who confirmed the company has sought legal advice and was keeping the FSA abreast on the matter, urged anyone who feels hard-done-by to contact the firm, although he insisted Standard Life would not be extending the remediation it has already announced.

When asked whether he was concerned that the toxic assets revelation would taint Standard’s reputation, Matthews said: “What we are very keen to ensure is that Standard Life’s reputation and brand stands for what we have done over the long-term.”

But perhaps the firm’s new business results were a slight reprieve from the recent barrage of bad news. Granted Standard’s pension sales dropped 11 per cent in 2008 but the number of new Sipp contracts written jumped by 41 per cent over the year to 65,900 with Standard Life’s fourth quarter customer numbers increasing from 3,500 to 4,900.

Group Sipp volumes increased over the year, by 21 per cent. But individual sales were 17 per cent lower – something the firm says is a result of market movements driving down the average incoming transfer value.

But Standard’s results are fairly consistent with those emerging from other Sipp firms.

Suffolk Life, the provider snapped up by Legal & General in May last year for a hefty £62m, says it had its strongest quarter of sales of its MasterSipp product in the first quarter of 2008.

Meanwhile, AJ Bell recorded a 23 per cent increase in the number of new Sipps sold last year, from 27,950 to 34,376. The provider had a particularly stellar fourth quarter, recording an 80 per cent jump in the number of Sipp contracts written compared with the same quarter in 2007.

Chief executive Andy Bell says: “Despite some adverse external influences, the Sipp market remains buoyant and the seismic shift from personal pensions to low-cost Sipps shows no signs of abating.”

Whether the FSA’s thematic review into pensions switching will hinder sales, as JP Morgan suggested after Money Marketing leaked the regulator’s report in December, we will have to wait and see.

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