In the week where an international tycoon spent thousands to avoid being named for alleged sexual misconduct, only to be named in the House of Lords anyway, there was plenty going on in the world of finance.
1) Getting together
Fresh from building its shiny new offices – complete with rusty-looking bridges – Schroders confirmed it was partnering with British banking group Lloyds to become a "top three" player in financial planning within five years.
The two companies plan to launch their new venture in the middle of 2019, with Lloyds pledging to transfer £13 billion of assets from existing subsidiaries into the new company. Schroders’ long-standing head of the UK intermediary division, James Rainbow, is to be the new chief executive with Lloyds’ head of insurance boss, Antonio Lorenzo, to take the chairman’s seat.
The strategic agreement between the two firms will also include developing investment "propositions" for Lloyds retail customers, where Schroders would provide active asset management services.
Schroders boss Peter Harrison said his company’s "award-winning technology" would complement Lloyds’ client base and digital capabilities.
2) Fighting for fairness
On Wednesday, the state pension was back in the spotlight when a Bristol-based academic submitted a petition challenging the government’s increase of the state pension age for women.
Law professor Jackie Jones challenged the mechanism used to increase the state pension age, claiming that it breached international law. The petition was signed by some 1,800 people who are urging the government to transpose the UN’s Convention on the Elimination of all Forms of Discrimination Against Women – or CEDAW – into UK law.
CEDAW is a set of rules that was originally adopted by the UN General Assembly back in 1979. The UK government ratified some of the rules into UK law in 1986, but failed to transpose the entire ruleset amid fears it would give women more rights than other disadvantaged groups.
3) More Mifid
Rarely a week goes by when there isn’t a Mifid II story, and this week there were two. It seems the Financial Conduct Authority is going to check up on intermediaries to make sure they are keeping on top of their new record keeping and charging requirements, under the new regulations.
While lawyers warned that there was potentially scope for the regulators to start "mystery shopping" advisers, the comments that followed from IFAs showed that there was still much confusion about how best to break down transaction costs for customers.
A second story underscored the problem, with a prediction that advisers would start moving away from platforms that had failed to keep pace with the changes required under Mifid II. These Asset Management director Lawrence Cook was speaking at FTAdviser’s Outsourcing Masterclass when he warned that platforms may need to change their strategy if they are to retain advisers.
4) Growing concerns
And, when advisers weren’t fretting about regulation, they were worrying about other issues. Interactive Investor – one of the UK’s largest platforms by assets – announced it was buying the Alliance Trust Savings platform, prompting concerns that advisers were going to be impacted by the acquiring company’s limited experience in the adviser market.
The Interactive Investor platform is a direct-to-consumer portal, but FTAdviser learnt that Alliance Trust is to be moved on the platform in the same way as the TD Direct platform clients were integrated when the business bought that in 2016.
Abraham Okusanya of consultancy firm FinalyiQ, said it meant clients had been shuffled "like deckchairs on the Titanic" to a platform with "zero experience" of dealing with advisers.
5) Light relief
On Tuesday, the Association of British Insurers warned the government to stop messing about with pensions tax relief, noting no less than six separate cuts to the annual and lifetime allowances since 2010.
With the government said to be seeking an extra £20.5 billion to pump into the National Health Service, the trade group warned Chancellor of the Exchequer Philip Hammond to keep his hands off pensions tax relief when looking for further savings.
"We recognise the chancellor’s need to raise revenue, but the salami-slicing approach to pensions tax relief sends out the wrong message," said the ABI’s director of long-term savings and protection, Yvonne Braun.
"Constant changes risk undermining people’s confidence and trust in long-term savings at the very point where auto-enrolment is bringing millions more into savings," she added.
