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Financial Services Newsletter - Friday 7th February 2020

07 Feb 2020

The regulator has refused to sign off on the £625m merger of Tilney and Smith & Williamson, throwing the schedule for completion into uncertainty as it addresses outstanding issues. In a letter to S&W shareholders seen by Wealth Manager, company Chair Andrew Sykes said that ‘the transaction structure for the merger has not met with [the FCA’s] approval’.

Tilney has paid compensation to a former client who was left without an Adviser for over a year. The Financial Ombudsman Service (FOS) found in November that the firm had failed meet a minimum standard of service by failing to provide a dedicated Adviser to the complainant, described only as Ms L, after her former Adviser left the company. For around 15 months until she withdrew her funds from Tilney in October 2018 Ms L had to personally administer her investments.

Citigroup has partnered with Aberdeen Standard Investments to launch a discretionary management service for mass-affluent UK clients. The new service will be available from the end of March beneath its Citigold banking service, which launched in early 2016 and which caters for clients with at least £150,000 in investable assets.

Investec Wealth & Investment is transferring its Bath office to a new Bristol base in Temple Quay. The move comes after the firm poached Alex Barrell from Brewin Dolphin to head the new Bristol office at the end of last year. A team of 22 , including five new staff added over the past year, will be moving from Bath to Bristol.

Hargreaves Lansdown (HL) Co-Founder Peter Hargreaves has sold a £550m stake in the business. According to a stock exchange announcement, Hargeaves sold around 34 million shares at £16 each via an accelerated bookbuild run through Barclays. Following the disposal Hargreaves retains a 24.3% interest in the business worth a little less than £2bn.

IFAs are flocking to consolidators and networks due to the rising costs of Professional Indemnity (PI) insurance. A variety of factors are causing increases on PI cover for Advisers – in some cases making it untenable for IFAs to continue to hold suitable cover.

HFMC Wealth has acquired IFA Aspinalls as part of its ‘growth strategy’ for this year. The deal, completed on 27 January, will bring in approximately 100 clients, one Adviser and four additional staff to HFMC. The total fee income secured by the deal is approximately £1m on £130m in assets under management, pushing HFMC's total assets under management to more than £1.4bn.

The FCA is still undertaking its nationwide door-knocking exercise to ensure Advisers are working in clients’ best interests. But as it puts a greater emphasis on ensuring firms are playing by the rules, businesses are having to reassess how they work. One issue up for discussion has been acquisitions by advice firms. Adviser conduct is scrutinised by the regulator, as the defined benefit pension advice crackdown continues. And large firms that regularly acquire other smaller ones can no longer be confident of a swift outcome, because the FCA is taking its time to ensure everything is okay.

Quilter will start moving advisers to new platform technology next month as a £185m project to move to FNZ technology nears completion. Between 22 and 23 February, 100 advice firms – around 10% of the firms that use the platform – are set to be transferred over to the new software. The remaining users will be transferred at a later date.

Consolidator Fairstone has acquired Swaffham-based Hamlyn Financial Services and Stevenage-based Wagstaffs Wealth Management. Hamlyn Financial Services, which specialises in pensions and investments, will bring an additional 2,500 clients into the Fairstone group together with six advisers and seven support staff. The acquisition also secures gross fee income of £830,000 and an additional £113m in funds-under-management for Fairstone.

In 2018, national advice business Sandringham made the unusual decision to U-turn on its restricted status to become independent. Chief Executive Tim Sargisson now has big plans for the business, including floating on AIM. ‘The worry I have is that there seems to be a lack of client-centric outcomes within the profession,’ says Sargisson. 

Financial advice consolidator AFH has announced a post-tax profit hike of 82%, as it continues its onward march to managing £10bn in funds. In a market update, the business posted its consolidated audited results for the financial year ending 31 October 2019. Highlights included a 47% revenue increase to £74.3m, a 65% increase in earnings before interest, tax depreciation and amortisation of 65% to £17.2m and a post-tax profit increase of 82% to £10.8m. Funds under management at the consolidator rose 40% to £6.2bln in the period, having previously sat at £4.4bln in its financial year results for 2018.

The NextGen Planners community has always been about its people and its 2020 conference will be no different, as this year's incarnation in London will put an even-greater emphasis on the well-being and mental health of its members. At the 2019 event, NextGen Planners has asked 30 volunteers from the community to help present proceedings. The volunteers will take to the stage at the event to undertake presentations to attendees on topics important to them and the next generation of financial planners.

When thinking about the UK platform market, Hubwise may not be a name which is recognisable to a lot of people. But the new-platform-on-the-scene is already making some big waves and is snipping at the heels of the established players. The firm – which styles itself as a ‘platform for platforms’ – provides white-labels for large advice firms, Wealth Managers and other institutions. To date it has amassed over £1bn of assets but it has got big ambitions and says it could reach £4bn by the end of 2020 and £20bn in five years’ time.

St James’s Place (SJP) has abandoned a planned purchase of Irish financial advice firm Harvest Financial Services almost a year after its initial announcement. The Dublin firm, which was founded in 1993 and is one of the republic’s retail Advisers, would have added €1bn (£850m) to SJP’s assets, in addition to providing local investment distribution. ‘Following careful consideration, SJP has decided not to proceed with the acquisition of Harvest Financial Services Limited,' a statement said.

In further news...St James’s Place (SJP) has replaced Janus Henderson Investors as Managers of its Global Emerging Markets fund with Somerset Capital Management. Somerset Capital, a global emerging markets investment management firm, was co-founded by politician Jacob Rees-Mogg, who was an Adviser at the firm before he left to take up the position of Leader of the House of Commons in Prime Minister Boris Johnson’s new cabinet last July.

Aspiring Paraplanners will be able to test their mettle and up their qualifications game thanks to a new level 4 paraplanning diploma launched by the London Institute of Banking & Finance (LIBF). The level 4 diploma in paraplanning (DipPP) is open for registrations and will start on 17 February. The paper will replace the existing level 3 certificate in paraplanning and financial administration (CertPFA) run by LIBF, but students studying for the level 3 qualification at the moment will still be able to continue their work, or transfer to the new scheme if they wish.  Mark Heaton, Managing Director of corporate and professional learning at LIBF, said that in the wake of Mifid II Paraplanners' skills deserved recognition ‘in their own right’.

Quilter Private Client Advisers has acquired national advice firm Prescient as it continues its spending spree into 2020. The acquisition of Prescient will bring the advice giant more than £800m in assets under management (AuM), Quilter said. Quilter will take on 23 staff from Prescient, including eight Financial Advisers, three Trainee Financial Advisers and support staff.

Scientist Gabrielle Walker has warned IFAs that diversifying portfolios does not protect clients from climate change risks. Walker said, if climate change continues on its current path, all asset classes will be hit and this will hurt portfolios no matter how well diversified they are.

Independent Wealth Planners UK has acquired chartered financial planning firm Prosper Wealth Management, which will become the company’s sixth regional office. Prosper Wealth Management was founded in 2003 by Managing Director David Barton and is headquartered in Wigan, Lancashire. The acquisition will bring an additional 486 clients, alongside four Advisers and six support staff.


Sesame Bankhall Group (SBG) has recruited Michele Golunska, Aviva UK’s Operations Director, as its new Chief Executive.

Mirabaud has hired two private banking veterans as it seeks to expand its UK presence. Martin O’Hare joins the London office of the Swiss group’s UK subsidiary as a Managing Director and Senior Private Banker. Mirabaud has also hired veteran UK Private Banker Rosalind Booth to its Zurich subsidiary. She brings over 30 years’ experience to her new role of first Vice-President and Senior Relationship Manager.

Consolidator Succession’s Chief Financial Officer Michael Hill is leaving the business following a spate of other high-profile departures. Hill, who was been with Succession since 2014, will leave the firm following a transition period in the first half of 2020. His departure comes amid a rocky period for Succession which has seen other senior figures exit, including Managing Director Tim Parsons and Recruitment Director Gerry O'Brien.

Nottingham Wealth Manager Fiscal Engineers has recruited John Clarke and former UBS Director Neil Wright in high-profile additions to its investment team.

Financial Planning firm Old Mill has recruited Chartered Financial Planner Neil Rushton FPFS to join its wealth management team. Mr Rushton, 39, has worked in financial services for more than 18 years and joins from Financial Planning firm Citimark where he looked after high net worth clients.

Cazenove Capital has raided rivals for a raft of senior hires across its London private client and charity teams. Karan Sejpal, who joins from UBS as Team Head, is among the high profile recruits. Other recruits include Rathbones' charities Business Development Head James Brennan, who joins as Portfolio Director after spending nine years in his previous post. Meanwhile Julian Bailey and Anthony Marsh join the private client team from Edmond de Rothschild as Portfolio Directors with responsibility for advising UK-resident individuals and entrepreneurs. Elsewhere, Wealth Planning Director Chris Hogarth and Wealth Planner Rob Hodgson have joined from UBS and Maymont Wealth respectively. The pair will work for Cazenove’s wealth planning capability.

JM Finn has boosted its financial planning team with the hire of former Cazenove Capital Wealth Adviser Clare Julian. The appointment follows a spate of recruits by JM Finn towards the end of 2019, most notably the hire of three Wealth Managers from Rathbones with a combined 70 years of service at the company.

Brewin Dolphin Chief Executive David Nicol is to retire after seven years in the role and will replaced by Director Robin Beer.

Ivestec Wealth & Investment has hired Christian Feroze as Associate Financial Planning Director. He joins from Beckford James where he was a Financial Planner for three years.

Sarah Coulson has joined Chatterton’s Solicitors from Close Brothers as a Chartered Financial Planner, she joins their Lincolnshire office

Simon O’connell has joined Tilney Group as a Chartered Financial Planner, he joins from LEBC and will be based in their Maidstone office.

Mike Clarke has joined Fidelius to manage their team of Financial Planners across the south east, Mike has a long and successful career in Financial Planning and adds a wealth of experience to their financial planning team.

Restricted advice network Openwork has appointed ex-RBS insurance Chief Richard Houghton as its interim Chief Financial Officer, following Kevin Chidwick’s departure after two years in the role.

Appointed representative (AR) network and support services group Sesame Bankhall has hired an Operations Director from Aviva as its new Chief Executive. Michele Golunska takes up the position having previously served as Operations Director in the insurance giant's workplace savings and retirement division.

Brooks Macdonald Managing Director and Co-Head of UK Investment Management John Wallace has stepped down after 15 years at the firm to join a Hampshire-based IFA. Wallace became Co-Head of UK Investment Management in November 2018 with Robin Eggar, following Nick Holmes departure after 22 years at the firm.

Mark Wilson has joined Tavistock as their COO from Prudential.



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All information provided in this Market Digest has been gathered from multiple Financial Services Media sources and individual company press releases.

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