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HSBC scraps tied advice service and axes 650 jobs

HSBC is axing its tied advice service in a move that will see up to 650 advisers lose their positions.

The bank is keeping its whole-of-market advice and execution-only services.

An HSBC spokesman says about 50 of the tied advisers will be given the opportunity to retrain and switch to its whole-of-market team, which currently employs around 320 advisers.

In June, the bank cut 460 adviser roles across the UK in a round of job cuts that totalled about 700.

In August, HSBC announced it is cutting 30,000 jobs worldwide in a cost-cutting exercise that could save up to £2.2bn.

In total, there will be 2,217 job losses in the UK, with retail bank staff and head office administration roles making up the bulk of the cuts.

In January 2011, Money Marketing revealed Barclays was closing its advice arm, Barclays Financial Planning, saying it will not be profitable after the RDR.

Barclays continues to offer advice to high-net-worth clients through Barclays Wealth but no longer gives retail clients advice through its branch network.

Lloyds Banking Group plans to split its direct advice arm as part of its RDR distribution plans, with one division offering basic protection advice and the other providing a financial planning service.

Nationwide Building Society is currently piloting a fee-based advice service through its single-tie agreement for investment business with Legal & General.

Churchouse Financial Planning director Keith Churchouse says: “The banks are starting to realise the middle market will not pay a fee for financial advice.

“Banks have focused their commission model on the middle market to date and they will be unable to do that after the RDR, so it is not surprising they are getting rid of advisers. They obviously see less demand in the future and are targeting wealthier individuals who will pay for their services.”

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. RDR is taking away financial advice from people who most need it. If someone inherits 30K they are not going to pay £1,500 for advice!

  2. HSBC should cut contact jobs 1st… This is unacceptable.

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