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Resistance growing to extending the Sandler model to with-profits

Financial services group Cater Barnard is teaming up with

entertainment financier Comerica Entertainment Group to launch the

Monument Film Fund, a new vehicle to fund UK films.

The fund hopes to raise £50m, with minimum initial investments

of £50,000 and increments of £10,000. Investors can get 100

per cent tax relief on their investment.

The fund will only invest in films which are deemed commercially

viable by an advisory panel of industry experts, with returns based

on their profits.

The fund opens to investment this week and closes on April 30.

The project has the backing of 20 of the UK&#39s most prominent film

makers including Oscar winner David Parfitt, producer of Shakespeare

in Love and The Madness of King George.

Cater Barnard chairman Stephen Dean says: “The Monument fund will

deliver what we consider to be the most comprehensive film investment

package available in the UK. We anticipate great demand for such an

attractive opportunity.”

The Government and FSA are facing high-level resistance from leading

life companies following its suggestion in DP20, published last week,

that the Sandler model could be mandatory for all future with-profits.

Norwich Union and Legal & General say they will resist any

proposal which will stop them offering traditional with-profits.

Under the proposals, proprietary companies would have to distribute

orphan assets, forcing them to stump up new capital for new Sandler

products, something they are presently unwilling to do.

Standard Life says the proposals limiting the use of with-profits

funds would affect the ownership of its bank.

Legal & General head of public relations John Morgan says: “The

Sandler proposals are in danger of diverting capital away from the

savings industry. They will offer little or no confidence to

consumers and no attraction to shareholders.”

Standard Life deputy chief executive Sandy Crosbie says: “The idea

put forward could prevent our policyholders from benefiting from

other parts of the business through our with-profits fund.”

NU senior actuary John Lister says: “The estate is used to provide

capital for new with-profits business. Who will provide the capital?

As a multinational company, Aviva can allocate capital to give best

returns for shareholders and it may not be in this market.”

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