The FSA must wake up to the fact that current industry reporting requirements are not based in reality, according to independent consultant Ned Cazalet.Cazalet warned the IEA annual conference last week that product providers are not disclosing real profits as their new business numbers in life and pensions are based on money being recycled around the industry. Data collated by Cazalet Consulting shows that life offices spent 21bn on commission in the last three years, excluding mortgages and general insurance, but the amount of net new pension business attracted stands at -12bn. Cazalet said: “How on earth are providers saying that they are profitable? What is the FSA doing? This suggests that the regulator needs to wake up on Icas. The FSA must ensure that Icas statements and individual capital guidance is founded in reality.” He also said that the closed life fund sector, which currently stands at a total of around 80bn, will double by 2010 because of further with-profits fund closures and the growth of open architecture. He said: “Half of life offices’ business is dead – it looks open but is actually dead. The closed fund sector is going to get an awful lot bigger and legacy activity will also increase. It will all be surpassed by open architecture. This is starting to happen right now.” Cazalet predicts that platforms will help to stem the recycling of pension money around the industry. But he said there will only be three or four big open architecture players by 2010.
Skandia Investment Management is set to launch a global best ideas fund this summer, which the group says will aim to take the 10 best ideas from 10 of the world’s top fund managers and put them into a single fund.
The Institute of Financial Services says there are signs that advisers are showing an appetite for equity release despite fears in the industry of a shortage of brokers.The IFS, which celebrated the first anniversary of its certificate in lifetime mortgages last month, says it has had a good take-up for the qualification that was launched […]
Matt Goodburn looks at whether we are approaching a market watershed
Norwich and Peterborough Building Society chief executive Matthew Bullock has been elected Chairman of the Building Societies Association for 2006-2007.
By Neil Jones Technical support manager with Canada Life’s ican Technical Services Team. Canada Life offers a range of wealth management solutions, including retirement income planning, estate planning and investment solutions from a choice of jurisdictions, including the UK, Isle of Man and Republic of Ireland. The treatment of non-UK domiciles that are resident in […]
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Another investment manager offering enterprise investment schemes has alerted clients of a 10 per cent drop in value for one of its portfolios following new Mifid rules. Mifid II, which came into force on 3 January, requires firms to notify clients when the overall value of their portfolio, relative to its value at the beginning of each reporting […]
The recent enquiry by the work and pensions select committee has reignited the debate about the future of collective defined contribution schemes. Whether these sort of schemes can be incorporated into the current UK pensions landscape is a moot point. Let’s consider some of the arguments for and against CDC. First of all, it is […]
Retirement interest-only mortgages are set to become more popular following the FCA removing hurdles to selling them. The regulator sees RIO mortgages as a possible aid to the waves of maturing interest-only loans with no repayment strategy. However, the FCA also wants RIO mortgages to be sold more widely, for example as an additional option […]