Fidelity International managing director Richard Wastcoat is looking forward to the Isa season. He says: “The permanence is a reassuring thing for IFAs and for consumers so they know they can count on Isas in the future.”
But he adds: “You still have a non-inflationadjusted annual limit which should be higher and I think the unresolved question is, at what point are these rules introduced? Is it in time for this Isa season or next or perhaps in a phased way? I think it is going to be difficult for the industry to be ready by April 5.”
Despite the confusion, Wastcoat says Fidelity is anticipating a good Isa season.
Looking further ahead to the introduction of the national pension savings scheme, Wastcoat says defined-contribution schemes could be undermined by the new Government scheme and some of the inflows of new money will be diverted. “The Government has tried, in the response they have given so far, to address those concerns. There is a concern that employers are not altruistic and if there is a way for them to save by reducing expenditure to the lowest common denominator, that would not be good news for people in existing schemes.”
The move towards Sipps could also put pressure on DC schemes but Wastcoat is upbeat about the possibilities.
“If you go up a level, I guess the good thing about what has been proposed so far is that it recognises the collective investment fund as the centrepiece of pensions and retirement savings. Roughly 85 per cent of our savings market is through insured-type products. In the past, that has been about with-profits, endowments and so forth and 15 per cent has been about mutual fund-type products, Isas, Peps and things like that. I think we are moving towards a position where we are putting mutual platforms much more at the heart of the country’s retirement savings.”
Wastcoat effectively runs two separate businesses. “There is a manufacturing business, with £40bn-odd of assets in Fidelity’s mutual fund management business, and FundsNetwork, a distribution business with getting on for £20bn.”
He says the business is broadening out from its traditional base of managing money and distributing funds through IFAs. Investment management firms have struggled to compete with life offices because of the life companies’ distribution networks.
“FundsNetwork changes completely the level of engagement that we might have with the big IFA firms. We are now talking about a product, a platform, which is an administrative solution, and increasingly about wrappers, this is beyond just mutual funds. It takes us from being relevant just to investment IFAs to being more relevant to more retirement or general savings IFAs.”
Multi-manager is an area where Fidelity sees growth potential. Wastcoat says non-specialist investment IFAs will increasingly use multi-manager, with an investment platform, to take a lot of the burden out of investment management.
“We aspire to be a broader financial services provider and in particular, a leader in pre and post-retirement savings. To do that, you have to be more than just a manager of funds.”
He says Fidelity will continue to develop products and he expects some new funds to be unveiled this year but says the business will also be looking at new areas.
Away from the office, New Yorker Wastcoat spends his time with his family, although he does like football. He was growing up in New York in the 1970s when Pele and Franz Beck-enbauer were recruited by the North Ameri-can Soccer League to raise the profile of the game in the US and he developed a love of the game long before he arrived in the UK. He has been a Chelsea supporter for a long time and says he is enjoying the current success but due to time pressures is unable to watch them as often as he would like.
One of the issues keeping him away from Stamford Bridge is the problem of appointing a successor to Anthony Bolton as manager of the UK special situations fund.
Wastcoat says he has a couple of candidates in mind but is unwilling to give any hints. The decision should be known by May, internally at least, on who is going to take over and should be made public by June with a six-month handover period to follow.
But he believes that the media attention focusing on who follows the legendary Bolton detracts from the work the rest of the firm does. “It is tough to get attention and notice for the other managers and it raises the bar for the others” but he admits this is a problem that he is happy to have.
Born: Manhattan, New York City
Lives: Fulham, London
Education: BSC in Business Administration from Lehigh University, Bethlehem, Pennsylvania
Career: 2000 to date: managing director of Fidelity International; 1998-99: deputy managing director, Fidelity International; 1996-98: executive director of European retail marketing, Fidelity International, London; 1989-96: marketing director for south east Asia, Fidelity International in Hong Kong; 1986-89: manager of product development, Fidelity international in London; 1983-86: marketing representative, Fidelity Investments South West, Dallas, Texas
Likes: The ocean, food, travel, especially in Asia and people with can-do attitude
Dislikes: Grass (the country), golf, cars, mediocrity
Drives: Golf TDI, Toyota Prius to beat congestion fee
Favourite film: Most by/with Clint Eastwood and Robert Altman
Favourite book: Something I look forward to in retirement, for now, New Yorker magazine
Favourite music: Lots, Hendrix/Zappa/Neil Young, Red Hot Chilli Peppers, Arctic Monkeys, Buddha Bar if I’m feeling quiet
Heroes: Too cynical to have them. People I admire include my dad and wife, Milton Friedman, Muhammad Ali and Fidelity group chairman Ned Johnson
Career ambitions: To succeed while maintaining a balanced life
If I were not doing this job I’d be… an investigative journalist for a hard life, sports commentator for a fun one