Why not take a break from all that Christmas shopping and treat yourself to the week in news?
The Financial Conduct Authority’s use of data has hit the headlines, as has the Financial Services Compensation Scheme levy. Here is what you need to know about what has been going on in financial services this week.
1) Data of the Dead
Ever wondered why you spent all that time using Gabriel? Well this week the FCA told you.
It published a summary of why it gathers the data and what it uses it for.
The FCA stated: “Collecting data through the retail mediation activities data items is an important part of our supervisory approach because it helps us to reduce the risk of poor consumer outcomes in the retail investment market.”
A little later in the week, however, the FCA had to address the concerns of the smaller businesses practioner panel about “increasingly onerous” data requests.
The regulator stated it conducts analysis before making a data request to find out whether it will be too burdensome for firms.
2) 168-year-old company, seeks buyer for annuity business with GSOH
Prudential became the latest provider to seemingly admit annuities are so twentieth century.
In June this year it withdrew from the open annuity market. Since then, the provider no longer accepts applications for new external conventional annuity business from financial advisers.
FTAdviser now understands Prudential is looking for buyers for its £45bn annuity business.
3) Problem with passives
It is that age old debate: Beatles or Stones? Red pill or blue pill? Active or passive?
This week Old Mutual manager Richard Buxton claimed the FCA had come out firmly on one side.
The chief executive of Old Mutual Global Investors accused the regulator of attacking the active management industry and promoting passive funds.
It all stems from the FCA’s asset management paper, which claimed there was “limited” price competition in the active industry, pointing out active fees have largely remained stable while passive fees have fallen.
Mr Buxton said the regulator had a “very price-conscious mindset”.
Perhaps the FCA prefers passives because unlike active managers they can't complain?
4) Bailey’s cream of the crop
OK, that heading doesn’t really work but it’s the best we could come up with and this week we learnt that the FCA’s new(ish) chief executive had sought to widen the scope of the Financial Services Compensation Scheme levy review.
According to Keith Richards, chief executive of the Personal Finance Society, he met with Andrew Bailey recently and learnt the FCA is looking at broadening the scope of the review.
Earlier this year - before Mr Bailey joined the regulator - the FCA was understood to not be considering a product levy because its introduction would require the introduction of legislation.
But this could now be back on the table. Will this be enough to get advisers to raise a glass to Mr Bailey?
5) The robos are coming
It is like in the Terminator films: you thought the robots were here to kill you, but it turns out some of them are actually here to help.
But for T-800 (Model 101) read Scalable Capital, which this week said advisers have nothing to fear from it.
The direct to consumer discretionary fund manager, which invests in a range of exchange traded funds, is already working with IFAs and is close to signing deals with other financial institutions, which will sell on its product.
Adam French, co-founder of the platform, said it complements the services of financial advisers.
In other words: “Come with me if you want to live.”
On that note... I'll be back next week with another round-up of the headlines that grabbed your attention.
damian.fantato@ft.com
