Ashcourt Rowan Financial Planning has bought the Co-operative Bank’s IFA arm and is paying £450,000 for the firm’s trail commission receipts.
Money Marketing revealed in July that the Co-op was looking to offload its IFA arm and in August linked Ashcourt Rowan to the acquisition.
Ashcourt Rowan is part of Syndicate Asset Management. The £450,000 for Cifa’s trail commission has been broken down into two instalments, with £250,000 paid to the Co-op on the first anniversary of the acquisition’s completion and the remaining £200,000 payable on the second. Future liabilities remain with the Co-op.
Cifa has around 55,000 customers with about £1bn of funds invested. It employs 52 staff, with most IFAs operating in the North, the Midlands and South Wales. Ashcourt Rowan says this will complement its IFA network based in the South.
Cifa’s advisers, sales managers and support staff will transfer to Ashcourt Rowan on completion of the deal and will be rebranded, along with Cifa’s client database and trail commission.
Staff are being transferred under the Transfer of Undertakings (Protection of Employment) regulations. It is understood that this agreement guarantees staff employment for a limited time period, thought to be a maximum of one year.
The deal will take Ashcourt Rowan’s funds under management to over £3.3bn and funds under management for Syndicate’s wealth division to more than £4.3bn.
Syndicate set up Ashcourt Rowan in January out of the merger of Syndicate subsidiaries Ashcourt Asset Management, Ashcourt Financial Planning and Rowan and Company Capital Management.
It has over 20,000 clients and a network of 17 offices. Syndicate has publicly said it is looking to broaden Ashcourt Rowan’s network of financial planners across the UK.
Ashcourt Rowan chief executive Mark Cheshire, a former Lloyds TSB Private Banking director, said earlier this year he was looking to significantly grow the firm’s assets under management.
Cheshire says: “I am delighted to add such a high calibre team of IFAs, sales managers and support staff to our business. They have the right balance of knowledge and experience to be able to best advise clients on the many sensitive issues that individuals and families have to address when planning for their near, mid and long-term financial futures.
“We believe the systems and culture within Ashcourt Rowan will provide an ideal environment in which the Cifa team and their clients can prosper.”
Co-operative Financial Services managing director of retail Rod Bulmer says: “We have sought an established IFA business that is committed to the market with an aspiration to retain existing Cifa client relationships. Ashcourt Rowan was assessed against our own core values and its determination to offer an excellent financial planning service made it the right choice for our IFA business.”
CFS merged with Britannia Building Society in August 2009 and integration between the two businesses is still ongoing. As part of the integration, CFS could consider selling its life and health insurance arm, which holds £18bn worth of assets.
A Co-operative spokesman last week reiterated comments made to Money Marketing in August, saying no decision has been made on whether to dispose of its life and health insurance arm. He says: “We have a massive integration programme taking place over the next two to three years with CFS and Britannia and that is progressing.
“We are going to have to look at things and that would include, for instance, the provision of life and savings and how we best distribute that but no decision has been taken so far.”