Pensions  

Dentons takes clients from rivals to boost profits

Dentons takes clients from rivals to boost profits

Self-invested personal pension provider Dentons has reported a surge in new business, much of it coming from rivals, as IFAs “gravitate towards the quality providers”, its sales director said.

David Fox told Financial Adviser that over 40 per cent of its new business came from pension savers with existing Sipps moving from other providers in a flight to safety.

Sipps have come under increased criticism in the last 18 months, following high-profile problems around some providers’ decisions to allow esoteric and unregulated investments, which subsequently failed.

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Last month, in a move that could have massive ramifications for the market, the Financial Services Compensation Scheme revealed it was reviewing Sipp providers’ liability for investor losses, potentially putting them on the hook for hundreds of millions of pounds.

Up until now, financial and reputational liability for ensuring that clients’ investments are suitable has fallen almost exclusively to their financial adviser, with Sipp providers always denying responsibility for suitability.

Mr Fox said Dentons – which does allow non-mainstream assets if they pass what it has said are strict due diligence criteria – is in a strong position compared with rivals and is attracting business from them.

“IFAs are gravitating towards the quality providers, the ones that can meet the capital adequacy requirements, the ones that haven’t got any regulatory issues with regards to non-standard assets,” he stated.

The firm reported record-breaking results for 2015, with new business up 12 per cent on 2014. Turnover reached £7m, up from £6m for 2014, while profits hit £1.5m, compared with £1.04m the previous year.