Hargreaves Lansdown has said a review of FSA register figures shows financial adviser numbers dropped by 1,200 in the lead up to the Retail Distribution Review, as it targets growth from what it perceives to be a corresponding rise in “DIY investing”.
Writing in the firm’s interim results, chief executive Ian Gorham said the adviser attrition, which equates to around 4 per cent of the market over the 18 months prior to RDR implementation, was indicative of a “general trend” towards execution-only investing and away from costly full-service advice.
Indeed, Mr Gorham said this trend was evident in the months leading up to 31 December, with Hargreaves reporting a 26 per cent increase in visits to its website for the six months to December 2012 compared to the corresponding period in 2011.
The Bristol-based firm posted record profits in the last six months of 2012, rising by 30 per cent to £93.7m. Revenue continued to grow and also registered a record rise of 24 per cent to £140.3m.
Total net business flows for the second half of 2012 came in at £1.65bn, up 42 per cent on the first half of 2012’s inflows of £1.16bn. Assets under administration rose by 30 per cent from December 2011 to £30.4bn.
Mr Gorham said: “We note that (net) over 1,200 financial advisers left FSA authorisation in the 18 months to 31 December 2012, over 4% of the entire industry.
“We remain of the view that a general trend towards DIY investing is likely to be beneficial to our cause, as people discover the value and efficiency to be gained through self-directed activity and a Hargreaves Lansdown account.
“Despite continued economic uncertainty in the UK, Hargreaves Lansdown has had the scale, financial strength and market presence to continue to improve its position.
“Clients appreciate our excellent value, service and informed comment. These results reflect our commitment to clients, the financial security of our business and our ability to provide ever more attractive ways of saving money and investing through a Hargreaves Lansdown account.”
