Norwich Union is introducing indemnity commission on regular contribution business into its investment funds.In a radical overhaul of its commission structure, the company will pay intermediaries 20 per cent of the first year’s contributions as up-front commission from August 31, with no further remuneration for three years, after which commission will be fund-based. If the product is cashed in early, NU will claw back 100 per cent commission for the first three years, 80 per cent in the fourth year and 40 per cent in the fifth year. The commission deal will be available across Norwich Union’s 35 retail funds and will include its fund of funds and joint-venture funds with JP Morgan and Schroders but it will not be offered on lump-sum business. Five per cent up-front commission will also be available on the firm’s tracker funds. Norwich Union sales director John Clougherty says the company wants to increase the amount of small and medium-sized investors making regular savings. He says: “This will help brokers bridge the commercial gap. Fee-based advice does not seem to work unless the client has a reasonable amount of money and it is not fair to criticise brokers for targeting high- net-worth individuals. “When people criticise up-front commission, they forget that it takes some level of advice and rigour from the adviser. “We would not have done it if the customer had to pay more than they do currently. We want to expand the market rather than take share from others. We have ambitious plans to increase our retail business share from 3 per cent to 5 per cent of the market by 2009.” Chelsea Financial Services managing director Darius McDermott says: “It is quite an innovative alternative commission structure for a fund management company to offer and the up-front trigger is a welcome option.” However, Syndaxi Financial Planning managing director Robert Reid says: “I think it is very disappointing that they have taken this retrograde step. I think the present level of commission is adequate and this leads to a drop in service standards.”
Resolution Asset Management has recruited Grant Shotter and Wilfred Willwong from Barings to be partners in its new emerging markets boutique, Hexam.
One of the first lessons all journalists learn at the start of their careers is that any official report can be interpreted in diametrically opposite ways, depending on the person reading it.
UBS Global Asset Management has appointed Matthew Cox to run the UBS UK select fund.Cox replaces Paul Fairbrother who moves to the pan-European equity team as head of portfolio construction.Cox has 10 years investment experience and has been at UBS for the last five. He is currently an analyst and portfolio manager on the European […]
Pensions tax simplification has swamped the industry with a 400 per cent increase in technical guidance pages and nearly double the number of pages of legislation that existed pre A-day.
The political uncertainty in Europe is not deterring the Artemis European Opportunities Fund, says manager Laurent Millet. There are still stocks, he tells Artemis’ Ross Leckie, which should thrive.
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