Fidelity Investments has decided not to enter the child trust funds market at this time.
It says this is because its latest feedback indicates demand for CTFs among IFAs and its investor-base is likely to be limited at the moment.
But it will continue to monitor the progress of CTFs over the coming year.
Managing director Richard Wastcoat says: “Since announcing our intention to launch a CTF we have been conducting ongoing research and analysis.
“Unfortunately, our re-evaluation has shown that the take up from IFAs and our investor base is likely to be weaker than we first thought and, therefore, we have decided not to enter the market at this point.
“We are naturally disappointed. We continue to support the Government’s efforts to encourage savings and, as such, will monitor the market and review the situation if conditions change.”