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DB transfers and Apfa's passing: the week in news

DB transfers and Apfa's passing: the week in news

If you’ve been feeling down in the dumps because British Airways ruined your half term plans then to cheer you up here’s a selection of the stories you didn’t miss by going away on holiday. Here’s the week in news.

1) DB or not DB

The soaring number of people transferring out of defined benefit schemes has provoked questions about this market.

The Pension Regulator revealed that up to 80,000 people made such a transfer last year as transfer values soared, which prompted advisers to call for reforms.

One of the areas of concern was the use of contingent charging by advisers carrying out DB transfers.

Perhaps predictably, this activity has caught the eye of providers, with Aviva saying it is looking to offer advice on DB transfers because customers were confused.

Meanwhile Aegon has urged the Financial Conduct Authority to put on hold its current guidance consultation into the way firms calculate redress for unsuitable DB transfers.

The redress consultation was launched in March, but the FCA has since revealed plans to consult more broadly on DB transfers but Aegon said this broader consultation should take priority.

2) Goodbye Apfa and hello Pimfa

This week brought the curtain down on 18 years of the financial advice industry being represented by the Association of Professional Financial Advisers.

Apfa - or Aifa as it was known for most of its history - is no more. It has ceased to be and gone to join the great trade body in the sky.

With its approval by the membership of the Wealth Management Association this week, the merger of Apfa and the WMA took effect, creating the Personal Investment Managment & Financial Advice Association - or Pimfa.

The merger had been approved by Apfa's membership the week before.

Liz Field, the chief executive of the WMA is now the head of Pimfa while Chris Hannant, director general of Apfa, will stay on for a transitional period as a "strategic adviser".

3) When you wish upon a star…

The problem with star managers is that, like everyone else, they will eventually have to be replaced.

The departure of high-profile fund managers Paul Marriage and John Warren from Schroders has led to speculation that investors might look to move their money elsewhere.

The pair are set to leave the asset management giant in the final three months of 2017 to create their own boutique, Tellworth Investments.

Schroders will now have to find a replacement manager for its UK Dynamic Smaller Companies fund.

Maybe if Schroders appoint someone who is less likely to outperform they might stand a better chance of holding onto them.

4) Something for the weekend?

Fidelty International has estimated that the cost of protection for retirees comes to more than £100,000 – inflation protection that is.

This is how much it would cost to buy the inflation protection offered by the state pension triple lock.

Using a flat rate annuity, Fidelity generated quotes that produced comparable annual income to the basic state pension and either tracked the retail prices index or rose by 2.5 per cent a year.