I am going to make a few bold and probably foolhardy predictions. The first is that Trevor Matthews departure from Standard will make next to no difference in the medium and long term to the life office.
The second is that he will have a massive impact on Friends Provident provided he gets there in time. Six months is a very long time in the UK life sector these days and for things to stay the same is probably not very tenable. But as I say things will get a massive shake up if Trevor gets there.
Taking my first bold statement, I would suggest Sandy Crombie is displaying a steely determination to show Standard’s transformation is not all down to Trevor. If they need someone else in the style of Matthews they will bring in someone else in the style of Matthews but possibly with less of a clash of personalities. Clearly he would have been the best person to see Standard’s Sipp and platform led transformation through but there are other talented people in the market who can.
But what of Matthews himself? Well for a start, we have to assume that the national papers are correct in their assumption that Standard would not offer him the top job.
Matthews was great for Standard on a host of fronts not least of all in terms of public relations, a vital skill as the life office transformed itself. He was also a straight talker and was prepared to say where the interests of life offices and IFAs diverged most publicly on the RDR. That was a lot better than some soft-soaping heard in other quarters. There was little suggestion that distribution was hearing one story and the stock market analysts another.
Matthews’ time at Standard saw a big push on wrap and a huge focus on profitability and long term sustainability of business. If such people had led the UK life office sector 10 or 20 years ago then they and their distribution – that is you the IFAs – might not have become locked in such a mutually dependent but also mutually suspicious relationship that in so many cases has bred contempt between the two sides.
But is he good news for IFAs now? Friends Provident says publicly that it does not see itself growing its market share in the area of GPPs and has often been slated in the past for the generosity of its commission payments but it wishes to have a policy of what it has it holds. Anyone involved in such business will appreciate what a difficult task that is.
In addition FP has now embarked on moves to sell F&C, Lombard and top end wealth managing IFA Pantheon. It is pulling out of wrap.
But these moves do not seem to come from the Matthews’ school of thought. Whatever one thinks of what happened and is happening at Standard, the possession of a strong and successful pure fund management business gives Standard some much needed balast as well as a source of profits. That of course was not Matthew’s doing and indeed is much more a Crombie achievement. But wraps and platforms are surely what Matthews is all about. Finally Standard is adamant that Trevor Matthews’ lawn is kept in trim and his herbaceous borders weed free. On my reckoning, he should get into his chief executive’s seat just about in time for the August bank holiday. We could be in the depths of a recession by then or indeed interest rate cuts might have seen everything come good including stock markers. In the meantime, Friends Provident’s Ben Gunn will aim to keep the ship steady and is as safe a pair of hands as any.
It is in everyone’s interests that life offices make some difficult choices. In the long run if it concentrates advisers’ minds as to what is profitable and sustainable it is a good thing too. But be in no doubt, effective as he is and even with a fair wind from the economy and the markets, Matthews will have his work cut out to give Friends a strong identity and a winning strategy once he gets there.