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Hargreaves questions future use of ‘independent’ tag

Hargreaves Lansdown says it will have to consider whether to maintain its independent tag as a result of the FSA’s retail distribution review draft proposals.

Questioning the impact of the rules on its advisory divisions in a response to last week’s consultation paper, it says: “The biggest question for HL will be… ‘Do we really want to maintain our independent tag?’ We may even decide to offer both independent and ‘restricted’ advice.”

In its trading update today, Hargreaves says it sees no significant threats, retrospective changes or costs to the group resulting from the draft proposals.

It says the bulk of its Vantage business is execution-only and so will therefore be unaffected.

The firm expects to announce full year pre-tax profits which are slightly ahead of the top end of market expectations, currently at £69.1m.

Revenues for the eleven months to May 31 are approximately 10 per cent ahead of revenues for the same period in the previous year.

It says the fourth quarter of the 2009 financial year is also proving to be strong on the back of high stockbroking dealing volumes and the positive impact of the market.

Assets held within the Vantage service increased by 15 per cent from £9.2bn as at March 31 to £10.6bn as at May 31.

The firm will announce its preliminary results for the twelve months ending June 30, on September 2.

Chief executive officer Peter Hargreaves says: “The business has again demonstrated its ability to gather assets and improve revenues even in adverse conditions.”


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