Although re-registration is a mandatory requirement for platforms, the goal of industry-wide automatic, in-specie transfers between platforms is still some way off.
With the added complication of multiple share classes and the threat of preferential shares being given to individual platforms, re-reg is taking longer than expected.
Money Marketing recently revealed platforms have clashed over the time it takes to re-register assets. Automatic transfers can be completed within five days, while the manual process can take up to two weeks longer in some cases.
Auto transfers need messages to be transferred between platforms via a message vendor.
Currently, platforms can choose from four main vendors in the market: Calastone, Altus, EMX and Origo. A number of platforms are yet to sign up to a message carrier, which means until they do all transfers have to be done manually.
Ascentric managing director Hugo Thorman believes auto re-reg is still a new concept to many platforms. He says: “There are some players in the industry that are not used to allowing re-registration off the platform and it is taking them time to work out exactly how to do it.
“We are still experiencing silly things like getting confirmation or rejection of transfers via post, which is against the whole point of auto transfers.”
A Money Marketing study reveals eight mainstream adviser platforms have yet to begin work with a message vendor.
Axa Elevate, Aegon, Aviva, James Hay, Zurich, Seven Investment Management, Raymond James Investment Services and Alliance Trust are all yet to appoint a vendor. Standard Life will use Altus although this is not yet live.
According to figures from The Platforum, these firms held a combined market share of 21 per cent at the end of 2012.
Axe Elevate managing director David Thompson says: “We are working towards automatic capability and we are talking to our technology provider FNZ. We will have something in place by the summer.”
James Hay chief executive Alastair Conway questions the speed of current message vendor options available. He says: “An industry standard for the registration of clients assets is long overdue. There are some solutions available but the technology has some way to go before it reduces the time it takes for assets to be transfered from one provider to another, especially for more complex portfolios.
“We continue to monitor the solutions available but are likely to wait until an industry solution is found.”
The regulator first stipulated mandatory re-registration in its November 2010 consultation paper saying re-reg should be completed in an efficient, reasonable time, although it did not say it had to be automatic.
International Financial Data Services group executive David Moffat says firms that have not signed up to a message carrier have slowed down the move towards automatic re-reg.
Moffat, who is also Tisa wrap and platform council deputy chair, adds the current re-reg systems are not fit for purpose.
He says: “The auto re-reg solutions available at the moment only work if you are re-registering a fund in the same share class. If you have to convert a share class then the transfer has to be done manually anyway.”
Earlier this month, Tisa announced it is considering setting up a working group to develop technology that would see automatic conversion between share classes when re-registering between platforms.
Moffat adds the FCA will soon apply a mandatory time limit on re-registration, which will force all platforms to use an automatic solution.
He says: “I fully anticipate that over time the FCA will expect time limitations on re-reg to come down. And while current time limits can be satisfied with manual processes, in the future, firms will have to have an automatic transfer capability in place to operate within regulatory boundaries.”
Calastone European business development director Dan Llewellyn says: “We are working on a solution to the share class issue and while it may take a bit of work, we do not think we are far off an automatic share class conversion system.”
|Aegon||Yet to decide|
|Alliance Trust Savings||Yet to decide|
|Aviva||Yet to decide|
|Elevate||Yet to Decide|
|James Hay||Yet to decide|
|Raymond James||Yet to decide|
|7IM||Yet to decide|
|Standard Life||Yet to start work|
|Zurich||Yet to decide|
* Not available when contacted by Money Marketing