Chief executive officer of Mattioli Woods, Ian Mattioli, has voluntarily reduced his basic salary to zero until the end of June in a move to protect the company’s financial position.
In an update this morning (March 27), Mr Mattioli said the wealth manager was implementing several measures to reduce costs in light of the uncertain trading conditions caused by Covid-19.
While he has chosen to forego his own salary, all other directors have agreed to reduce their basic salary or fees by 50 per cent until June 30 when the company’s position will be reviewed.
The firm has also confirmed to staff that it is likely they will not receive any bonuses for the current financial year with the funds instead going to help address the impact of coronavirus.
Mr Mattioli said: “I believe this position supports the board's independence and ensures a strong governance framework.
“In addition, we are reviewing our operating costs, restricting travel and reducing discretionary spending.”
Despite saying it was too early to predict the full impact of Covid-19, Mattioli Woods expects to suffer from disruption to trading in the coming months which could impact its income streams linked to the value of clients' funds under management and advice.
But as the majority of the firm's revenues are fee-based, rather than linked to clients’ assets, the impact isn’t expected to be too significant, the firm said.
Mattioli Woods is also set to profit from time-costed advice to clients on how to deal with coronavirus, which the firm said provided “a revenue profile that typically is less sensitive to investment markets”.
Despite Covid-19 disrupting many businesses, the wealth manager continues to be fully operational throughout its core business areas, continuing to provide advice via 124 consultants and offering its self-invested personal pension (Sipp) and small self administered scheme (Ssas) products.
Mr Mattioli said: “The board will continue to keep the market updated as the situation develops. The group remains in a strong financial position and we will continue growing our business when it is appropriate to do so.
"We are passionate about looking after our clients' financial affairs and I hope all of our clients, staff, suppliers and shareholders come out of this crisis in the best possible shape."
Earlier this month, Mattioli Woods announced that it would acquire private client adviser and asset manager Hurley Partners in a deal worth up to £25.6m.
The acquisition is subject to regulatory approval and is expected to complete in the second quarter of 2020.
Mr Mattioli said: “The group enjoys a strong balance sheet and following completion of the acquisition will continue to have significant cash balances and headroom on its regulatory capital requirements.”
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