Specialist wealth management and self-invested personal pensions (Sipp) business Mattioli Woods has stopped giving defined benefit (DB) transfer advice following an internal review.
The decision to stop the service entirely came after the business carried out a review of its transfers from DB to defined contribution schemes earlier this year, which included dialogue with the Financial Conduct Authority (FCA).
The firm had suspended its transfer service earlier this year.
Ian Mattioli, CEO of Mattioli Woods, said the firm did not expect to see a big financial impact from quitting the business.
He said: "We are surprised that other businesses haven’t come out of the DB transfer market completely.
"From our perspective, it seems as though transfer values have declined and the FCA has become concerned by trustees leveraging transfer values to lessen their liabilities.
"Last year, just 1.6 per cent of our revenue came from our DB transfer advice service and so we have felt little financial impact by coming out of the market. We have no plans to go back to provide advice in that area."
Since the introduction of pension freedoms in 2015, the number of people transferring out of their final salary pensions has been soaring, as savers seek to take advantage of sky-high transfer values and to move their nest eggs into defined contribution schemes in order to access their cash.
According to data from the watchdog, £20.8bn was transferred out during 2017, more than double the volumes registered in the previous year.
In October last year, the FCA revealed advice in more that half of the DB pension transfers it has reviewed was unsuitable or unclear.
The watchdog had analysed 88 DB transfers since 2015 and found only 47 per cent were suitable, 17 per cent were unsuitable and in the remaining 36 per cent suitability was unclear.
The regulator has been focusing on the defined benefit transfer advice market, and announced that it will be collecting data from all financial advice firms which hold pension transfer permissions during this year.
In January, the watchdog sent a letter to all firms holding pension transfer permissions revealing the red flags the regulator will be looking for when it enters advisers' offices.
rosie.quigley@ft.com
