Pensions  

Who will win the three horse Sipp race?

Who will win the three horse Sipp race?

AJ Bell, Curtis Banks and James Hay Partnership have been touted by John Moret, founder of MoretoSipps, as the three biggest self-invested personal pension business competing to become the provider with the most Sipps under administration.

The three providers currently hold 85 per cent of the market share, with AJ Bell holding 34.9 per cent of the market, James Hay Partnership 26.1 per cent and Curtis Banks and Suffolk Life 12 per cent and 11.7 per cent respectively.

FTAdviser has asked bosses at AJ Bell, James Hay and Curtis Banks to explain their business models, how they intend to get more of your business and which non-life company they think will dominate the Sipp landscape in the years to come.

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The three companies all agreed they were the three largest non-life company players likely to dominate the Sipp space in the years to come and that they have different approaches to building their market share.

However they disagreed on which approach will reap the most rewards.

Mr Moret said: “Except for Standard Life and Hargreaves Lansdown, which are a bit different, we now have three big Sipp businesses – AJ Bell, James Hay and Curtis Banks, which between them probably have around 200,000 Sipps.

“But each employs very different models. AJ Bell has never really made acquisitions. At the other extreme is Curtis Banks, which has grown mainly through acquisitions. Then there is James Hay in the middle, doing a bit of both.”

Mr Moret said over time the interesting question is which will be the best strategy, adding AJ Bell is essentially a platform business, James Hay is trying to become a platform business and Curtis Banks does not have a platform.

Alastair Conway, chief executive of James Hay Partnership, said he agreed with Mr Moret’s vision of the market in the future.

He said: “Curtis Banks is much more of a traditional Sipp shop but theirs is very much taking traditional Sipp books and going on doing a really good job of managing them as they are.

“That is fine, there is a place for that. They are doing quite a bit of consolidation of other books at the moment that look similar to the ones they have got.”

Mr Conway said AJ Bell was ahead of James Hay in moving into operating as a platform, but he claimed his rival was looking to do more “direct to consumer” business.

Mr Conway said James Hay sits “somewhere in between the two” rivals as he plans to grow his Sipp book without going direct to consumers.

He said: “The vast majority of our business is through the advised market and we see that as our role of providing a retirement platform to the advisers.”

A spokesman for AJ Bell stated Mr Conway was wrong to think the Sipp provider was going direct to consumer in a bid to boost the business.

When asked would AJ Bell be the biggest non-life company Sipp provider in the future, Mike Morrison, head of platform technical at AJ Bell, said there will be room in the market for all types of Sipp operator, whether platform focused, bespoke or self-managed.