Snippets from last week’s news you may have missed. With grateful thanks to Financial Adviser, Money Marketing, New Model Adviser and Professional Adviser.
Eclectica
A new fund which aims to invest in global agricultural commodities has been launched by Eclectica Asset Management. The specialist asset manager is offering its CF Eclectica Agricultural Futures fund, which adds to its existing Eclectica Agriculture fund, a long-only global equity fund, which was launched in June 2007.
Sarasin
Sarasin & Partners has reported that its AgriSar fund attracted £50 million in the eight weeks since launch, The company says that the fund has appealed to wide range of investors seeking long-term gains from the ‘agricultural mega-trend‘. Despite a flurry of agricultural fund launches in recent months, including offerings from Schroders, Castlestone, and Eclectica which invest predominantly in commodity futures, Boucher said the AgriSar fund had a unique approach.
Royal London
The pensions specialist arm of the Royal London Group, has added the new funds Gartmore Emerging Markets Opportunities and First State Emerging Market Leaders, which are both available within Scottish Life’s governed Fund Matrix. Nick Leitch, head of investment marketing for Scottish Life, said: “These emerging market funds complement our existing range. The funds will form part of our Fund Matrix, a unique concept which gives investors the opportunity to invest in external equity funds, supported by the oversight of an experienced governance committee.
Investec With Profits Pack
Investec asset management has launched an initiative designed to assist advisers and their clients. Their with profits review pack is intended for IFAs navigating through the sector, aiding review of clients’ existing with-profits investments. David Aird, managing director, UK distribution for Investec asset management, said: “As part of our ongoing endeavour to be supportive partners to the IFA community, we have developed this resource to assist with the complex task of reviewing their clients’ with-profits investments.
AXA Portfolio Planning tool
The tool is available online and is part of the company’s wealth management adviser offering, allowing IFAs to create individual financial solutions for clients. It covers investment, retirement and budgeting. In addition, it analyses clients’ existing pensions and investments, captures clients’ medium-term goals, assists in determining client attitudes to risk and appropriate asset allocation and creates portfolios tailored to clients’ investment objectives.
Norwich Union job losses
Up to 1,800 Norwich Union staff will lose their jobs by 2010 as part of a consolidation drive across the general insurance division at the group. The group is scaling back operations in 22 towns and cities to develop seven new centres in Norwich, Perth, Bishopbriggs, Stretford, Manchester Leicester and Southend. Operations are closing in Dundee, Glasogow, Leeds, Sheffield, Liverpool, Cheadle, Birmingham, Bristol, Southampton, Basildon, Ipswich, Exeter and Worthing.
Chancellor to force ‘MPC for financial stability’ on KingThe Chancellor is to impose a panel of advisers on the Bank of England which will aim to prevent another Northern Rock by focusing on financial stability in the same way as the MPC focuses on monetary policy. Darling told MPs that an expert panel was needed to identify emerging financial dangers such as the northern Rock crisis. The panel will be a group of City insiders without conflicts of interest but with experience in the banking sector. Darling compared the new committee to the independent MPC. He said: ‘A similar approach in relation to financial stability [is needed] to bring in outside expertise to advise the Governor.’
Protected rights survivors rule axed
The government has axed a rule that requires people to leave their protected rights savings to their surviving spouse as part of its drive for pensions simplification. Currently protected rights must be used to buy a joint life annuity but from 2012 when contracting out is abolished, the protected rights pension can be combined with other pensions pots.
Adviser breaching TCF rulesAdvisers have been warned by John Baxter a consultant from True Wealth Management who advises IFAs, that they are breaching treating customers fairly rules if they move clients’ existing investments wholesale onto wrap without prior analysis of their suitability for the change.
‘I’ve had a number of discussions with firms that don’t do analysis. They don’t believe they have to because the new environment is so good,’ he said. ‘But they are not treating customers fairly by wholesale churning into that environment.
AXA promises to do better with its poor service
Paul Evans, chief executive of AXA Life, said that the firm was working hard to stamp out administration and service problems across its legacy and wealth management business after a number of complaints from IFAs. Evans said that the firm has sent staff on intensive customer service courses and learned from development at AXA PPP but admitted that further progress was needed on service issues. ‘I think we’ve made some mistakes in the past. We had broken customer experiences into processes. That meant that no one person took responsibility for the customer,’ said Evans.
Royal London completes Scot Prov Intl transfer
Royal London, the UK’s largest mutual, has completed the acquisition of Scottish Provident International Life Assurance (Spila). The deal, which includes the transfer of Scottish Provident and Scottish Provident International, was approved by the FSA in April as part of Pearl’s acquisition of Resolution.
Advisers believe PFS will be swallowed by CII
Over half of advisers think that Fay Goddard will be able to turn round the fortunes of the Personal Finance Society (PFS) as its new chief executive, but 71% of them believe that the body will ultimately be absorbed by the Chartered Insurance Institute (CII). Just over half, 52%, of 50 advisers surveyed by Citywire® said they were expecting Goddard, the former deputy director general of Aifa, to change the professional body when she steps into Tim Eadon’s shoes in July.
If the majority of advisers predict correctly, Goddard will not have time to settle into her role because the adviser body will no longer be around. Despite a distinction between the adviser members of the PFS and the insurance sector members of the CII, many advisers think that the two have started to overlap and the adviser body could be eaten by its parent company.
The Chartered Financial Planner qualification secures the body in the financial planning space however less than half of advisers who responded thought that the PFS should concede the financial planning space to the Institute of Financial Planning (IFP) although the majority of advisers thought the IFP and PFS should work together.
FSA plans to ban orphan cash being used to pay for misselling
Advisers have welcomed an FSA proposal to ban insurers from using with-profits inherited estates to pay misselling claims.
The move was outlined in an FSA consultation paper published this week and could see an end to the current practice of product providers paying misselling compensation out of their inherited estates.
LV= launches enhanced with-profits annuity on The Exchange
LV= has launched its enhanced with profit pension annuity on The Exchange’s Exweb portal.
Full medical details will be captured within the Exweb platform and then passed to LV=, who will then provide an enhanced annuity quote based on these specific conditions in real time.
LV= head of annuities Matt Trott says: “By working with The Exchange we are making our enhanced annuity more accessible than ever, which is especially important when we are seeing increasing popularity in such a growing market.”
A third of IFAs planning to recommend third-way products
More than a third of IFAs plan to advise clients to use products with guarantee, or so-called “third-way” products, as an alternative to traditional annuities, research by MetLife Europe has found.
The survey shows that 38 per cent of IFAs say they will advise clients to use guarantees in their pension planning over the next year. ”Advisers are reporting increasing interest from clients in guarantee-type products and are recommending them more often as they recognise that changed circumstances require changes in products.”
Prudential launches two target return products
Prudential has launched two new target return funds to complement its existing inflation plus 5pc fund, launched in 2005.
The Diversified Growth and Defensive funds aim to provide inflation-beating returns of CPI plus 4pc and 6pc respectively over the medium-term, by investing in a wide range of asset classes. The pooled parent to the new funds achieved a 10.2pc per annum annualised return between March 2005 and March 2008.
Prudential takes top position in life fund survey
Prudential’s With-Profits Life fund has retained its position in the WM Life Fund Survey for 2007. The fund returned 7.2pc for the year, against a life fund average of 5.8pc.
Martin Brookes, head of Prudential’s portfolio management group (PMG), said “The biggest driver of our fund is asset-allocation. Getting the big picture correct is very important in order to get the overall asset mix right,” he said.
The FSA has launched a new website billed as a “one-stop-money-information shop” for young adults.
The website (http://www.whataboutmoney.info/) forms part of the regulator’s National Strategy for Financial Capability and follows its own research, which found more than two-thirds of young people are not planning ahead and external findings revealing that 80pc of young people are in debt by the age of 21.
The site has been developed in partnership with YouthNet – a charity with expertise in communicating with this age group – and aims to guide and inform as well as provide an aid to breaking down the barriers which may be preventing young adults from considering and learning more about money matters.
Financial services ’suffering from skills shortage’
THE Chartered Insurance Institute’s (CII) second annual skills survey has revealed a worsening skills shortage in the financial services sector. Three quarters of employers surveyed reported shortages of technical skills, 5pc more than in 2007, with the issue becoming so critical that it is now on the agenda in four out of five boardrooms.
Investment platform forum for IFAs launched
MEDIA communications house Cicero and strategic advisers HM Consulting have teamed up to launch The Platforum.
The joint venture is a free subscription site providing news and information, filmed interviews and a networking hub for financial services executives with an interest in investment platforms.
The Platforum can be found at http://www.theplatforum.com/
