Citywire for Financial Professionals
Stay connected:

View the article online at http://citywire.co.uk/money/article/a886710

Alliance Trust Savings hikes account charges

Fund supermarket Alliance Trust Savings raises account fees as it seeks to cut losses and repay the cost of new technology.

 
Alliance Trust Savings hikes account charges

Fund supermarket Alliance Trust Savings (ATS) is to hike its account fees and charge customers monthly as it seeks to cut losses and repay investment in new technology.

From 1 May the administration fee on its ISA and Investment Dealing Account will rise to £7.50 a month totalling £90 a year. It currently charges £18.75 a quarter, an annual cost of £75.

Charges on new Sipp (self-invested personal pension) ‘Savings’ accounts will rise to £18 a month, including VAT, totalling £216 a year. Customers currently pay an annual bill in advance of £186 including VAT.

For new investors seeking to take an income from their Sipp the charge will rise to £25.50 including VAT, equivalent to £306 a year. That compares to the current annual charge of £276.

Existing Sipp customers will not pay the higher fees until February 2017.

Fees on child ISA and Sipp accounts are not increasing but will move to £3.33 a month, instead of £10 a quarter, giving an annual charge of £40 including VAT.

Charges for customers with financial advisers will rise by a similar amount, the company said.

ATS, which is owned by Alliance Trust (ATST ), the 128-year-old global investment trust, is popular with investment trust investors. It also stands out from rivals like Hargreaves Lansdown in applying flat fees rather than variable charges based on a percentage of the money held in customer accounts.

Managing director Patrick Mill said: ‘Costs are going up and we have invested in technology for the platform which will make it better for customers to deal with us.’

Last year ATS signed a deal to switch to platform technology provider GBST and is due to complete the changeover in May after the busy end of tax-year period.

Technology costs and management changes cost the business £18.9 million last year, according to today’s annual results from Alliance Trust, pushing ATS’s pre-tax losses to £5.2 million from £3.9 million. Customer numbers rose to over 84,000 following the acquisition of Stocktrade from Brewin Dolphin.

45 comments so far. Why not have your say?

AA

Mar 04, 2016 at 12:02

Disgraceful lot! 20% rise with no promise of a freeze for the next few years, I will definitely consider switching smaller ISA of my son and close investment dealing account.

report this

Michael Beaman

Mar 04, 2016 at 15:10

Puzzling. I have just switched from Alliance to Hargreaves partly because the latter charge nothing for the stocks, investment trusts and etf's that I hold!

report this

timothyskinner

Mar 04, 2016 at 17:55

My ISA charges at ATS now total double what they would be at Charles Stanley Direct.... hmm... that makes a move now sensible in my book....

report this

Roger Lawson

Mar 04, 2016 at 18:00

Well increasing fees is one way to make Alliance Trust Savings profitable which is a long standing problem that Alliance Trust investors know only too well. Consistently loss making and a burden on investors in the Trust. So one can see the logic in it, even it is simply a preparation for selling that subsidiary off.

report this

hooligan

Mar 04, 2016 at 18:12

the fees are that dissimilar if you were getting paid for quality. just wait until the young women of colour get the reins on the investment strategy and the "pale, male and stale" losers leave.

report this

hooligan

Mar 04, 2016 at 18:12

insert "not" after "the fees.."

report this

talbot

Mar 04, 2016 at 18:50

I to will switch the costs are to high if you have only a small amount invested

My sole investment with ATS is invested in Alliance Trust my shares bring in £177.88 per year I would think that a charge of £90.00 per year is far to high

You would have thought that the Directors would want their shareholders to support the trust to help to narrow the discount I thick I will switch into Witan

The Question which provider should I use?

report this

edward sutton

Mar 04, 2016 at 19:01

I left ATS over two years ago .due mainly to the incompidence of he sipp department . And also the intrduction of charges on my four first steps accounts. I moved to A J BELL where my ISA Dealing and four Junior ISAs cost me nothing other than dealing costs .my SIPP costs are similar to ATSs. I suggest its time for ATS customer to move on.

report this

mark antrobus

Mar 04, 2016 at 20:21

For the SIPP at least Alliance Savings have captive customers because you cannot transfer stocks directly to another provider; there are significant buying and selling fees, and the real risk that the market will move against you when you are out of the market. Therefore imposing unjustified fee increases for existing customers over the last few years above inflation or the rest of the market is a blatantly uncompetitive practice and I am surprised the regulator has not taken action.

report this

hooligan

Mar 04, 2016 at 20:23

mark,

surely you own your shares and can just issue a trasnfer of title instruciton with no trades or stamp duty?

report this

john_r

Mar 04, 2016 at 21:20

@ Mark, Seems your comments are just wrong. From the information I have seen it is very easy to transfer your stocks to another Sipp provider (assuming the new Sipp provider also deals in the stocks). Yes there is a transfer cost per stock (around £15) but that avoids selling the investments first - so there is no risk of the market moving against you. As regards the latest fee increase investors who object to the increase have been offered the opportunity to transfer (within a limited time period) free from charges. What can be fairer than that?

I am sure these regulator would find the terms perfectly acceptable.

report this

A Swann

Mar 04, 2016 at 21:27

You can transfer individual stocks,it's called an in specie transfer. I moved my Sipp from ATS to AJ Bell several years ago with a mix of cash and in specie Although ATS messed it up first time around and it took a while

report this

AA

Mar 04, 2016 at 21:57

As I raised in the very first post, this time there is no reassurance of a freeze in charges, implication being next year could be another 20-30% even 50% increase. Who knows? ATS is bound to be the most profitable operation of Alliance Trust if you account and apportion the costs fairly and properly.

report this

James dooley via mobile

Mar 04, 2016 at 22:39

Still cheap if your portfolio is large enough. Yes % increase is large but what is the % difference to your account? £90 or even £190 is still a tiny percentage of a £250k portfolio for example. They are obviously aware they will lose smaller accounts and have decided it's worth it.

report this

Roger Lawson

Mar 05, 2016 at 09:01

Be wary of the time and effort it takes to make a transfer to another platform - it can take several months even for simple transfers. We have complained about this to the FCA. Roger Lawson, ShareSoc

report this

Anonymous 1 needed this 'off the record'

Mar 05, 2016 at 09:14

Certain family accounts were moved across to ATST when Brewin Dolphin sold their Edinburgh based cheap share dealing account . I have never come across such total chaos during this period of transfer and we are now desperately trying to move those accounts elsewhere . During this period it has proved impossible to deal at a time when markets have been very volatile .

report this

richard tomkin

Mar 05, 2016 at 09:19

Perhaps they are trying to recoup some of the £3.5 million they (we) spent fighting Elliott Associates,before cravenly giving in,last year.How else to explain an increase of forty times the rate of inflation?

report this

Anonymous 2 needed this 'off the record'

Mar 05, 2016 at 09:28

I've had investments at Hargreaves Lansdown for over 15 years. About 4 years ago (when HL hiked their charges) I moved the bulk of our investments to ATS to take advantage of the lower charges & so that my IFA could manage them.

The ATS platform is hopeless compared to HL. BEFORE they put their charges up, they need to provide a good platform comparable to HLs. I've told them this several times, but they don't listen. I'll be looking to move from them.

report this

talbot

Mar 05, 2016 at 09:33

Looking to move where to? Who do you suggest?

report this

AA

Mar 05, 2016 at 09:51

Interactive Investor appears to be the most attractive alternative. Any thoughts?

report this

richard tomkin

Mar 05, 2016 at 09:55

(Talbot) One option would be to buy shares in certificated form and keep the certicates at home.Dealing would be more expensive,but there would be no trail charges or unscrupulous levies.Also you would be on the investee company's share register and so receive annual reports etc - something you never get with nominee holdings.

report this

Mick Harris

Mar 05, 2016 at 10:50

Having worked in the platform industry for 15 years, I've undertaken a number of price and proposition comparisons for a range of clients. The rise in fees is unwelcome but not surprising. They are very transparent whereas the ad valorem platform charges of other platforms e.g. HL are harder to establish without some calculations. The higher the value of your ATS portfolio the cheaper it becomes because of the fixed nature of the fees. The portfolio turnover is material too of course. In the end you have to look at your own portfolio and decide. All that said I believe its not about price but "value" and that is an individual thing. The web site is dreadful and I await the implementation of GBST to see if that improves things.

report this

Michael Beaman

Mar 05, 2016 at 11:33

I transferred an ISA, Share & SIPP account from Alliance to HL. All are being done in specie and the first two took about a week once I had completed the paperwork. The SIPP takes a bit longer because there are a few extra complications. HL were quick and Alliance less so but OK. I am now transferring a small ii account to HL and that appears to be going along ok. This is because ii issued tax certificates as late as end October last year and their services are far more basic.

report this

Roger Lawson

Mar 05, 2016 at 12:03

That's not my experience. A transfer out of HL to another SIPP provider took over 3 months, and a transfer out of Stocktrade (now part of Alliance) also took 3 months. The experience of ShareSoc members is that transfers can take a very long time, however much you chase them. It seems to make no difference as to what you have in an account although fund transfers seem to take a particularly long time with some funds.

report this

RippedOff

Mar 05, 2016 at 12:49

ATS charges hike is a disgrace. The FCA should stipulate that transfers out should not incur any charges at any time following a price increase by all platforms. They should also stipulate time limits for transfers. If this can be done for gas & elect switching then so should be the case for investments.

ATS also have a current SIPP annual report charge of £75+VAT which is so generic that it is worthless. This may be technically correct but is immoral (sorry this is not an understood term by many in the investment industry. You can opt out of the report (they know its useless) but not the charge!

Beware of artificial obstructions re transferring in-species funds. E.g. Aviva have a number of "Alliance Trust ...pension funds". But insist that these are sold before transferring to ATS - where investors are exposed to out of market risks and unnecessary charges.

Having said all this I would most definitely not return to Hargreaves.

report this

Frank Frank

Mar 05, 2016 at 13:28

£90 pa charges by Alliance are peanuts compared to the ad valorem charges of other platforms.

However I have heard that the quality of the Alliance platfom is poor and that is the fault of the previous CEO, who seems to have been nothing more than a pretty face.

report this

Michael Beaman

Mar 05, 2016 at 13:37

Actually, if was her predecessor. American male.

report this

RippedOff

Mar 05, 2016 at 14:58

Frank Frank, The article indicates other annual, and drawdown SIPP charges. There are also event charges e.g. purchasing a fund. And has been stated, the comparable % fee depends on the value of the distinct investment elements. So each person needs to evaluate this to make a correct comparison.

report this

hooligan

Mar 05, 2016 at 15:40

Having worked at brokers and fund managers over many years I can tell you that it takes the same amount of work, effort and time to complete an "in specie" transfer as it does an ordinary buy or sell of shares.

In other words if the normal settlement period for shares in T+3 days, the tansfer should take the same time. A period of longer than this represents a failed trade, the statistics for which are, I would guess, at least monitored by the FCA and persistent delays/fails in completion would see the license to trade on the exchange revoked.

Are AT a licensed broker?

report this

alan franklin

Mar 05, 2016 at 16:06

This company has proved utterly inept at everything they have attempted since we were transferred from the much lamented Stocktrade.

Things like share dealing that were easy to do with Stocktrade require a raft of stages before they can be achieved at Alliance. Trust? I wouldn't trust them to run a bath.

report this

AA

Mar 05, 2016 at 17:00

They are about the kill the goose that lays golden eggs. They need to freeze charges for at least five years and get their poor act together to deliver a contemporary competitive service.

report this

Michael Beaman

Mar 05, 2016 at 18:07

Can this be? Their bumph said that their customer service is "award winning". Which of course begs the question......

report this

No name 2

Mar 06, 2016 at 09:11

The great advantage of ATS is transparency - all fixed charges and no percentages, particularly good value if you are a substantial investor. I also value their customer service in that I have no trouble in contacting them and they are invariably well informed and helpful. I'm not surprised at the increase as they have to balance the books but it is essential ATS maintains a reputation for good value centred on its USP of fixed transaction based charges. George

report this

Dave Harrington

Mar 06, 2016 at 17:58

For anyone thinking of switching to Interactive Investor ... from personal experience ...don't do it ....utterly inept....they took 10 weeks to transfer my SIPP which, knowing how useless they were, I had already converted to cash for a speedy transfer, 5 months to set up a direct debit, they charged me £60 to receive an electronic transfer of £155 from my previous SIPP provider, I would recommend a sack of spuds before I'd recommend Incompetent Investor ....I was with them for 10 excruciating months.

report this

Bruce via mobile

Mar 07, 2016 at 09:18

At least this time ATS have waived exit fees for a period; although it doesn't seem fair to give existing SIPP customers, who've only paid their annual fee a month ago, only two months to take advantage of that, rather than allowing it up until the new fees kick in.

@Roger Lawson: For platforms that take a long time to transfer assets across ask them whether the implement the "TeX" (TISA Exchange) standards. These are open standards that allow platforms to exchange details of the accounts and assets to be transferred, and allow transfers to happen in as little as a few hours. Pointed questions on how platforms and stockbrokers that don't support these meet their obligations under COBS 6.1G is definitely in order.

report this

Keith Cobby

Mar 07, 2016 at 09:25

We have an ISA and SIPP with ATS and also prefer the transparency and fixed charges.

They also credit dividends on the due date (which others may not) and have a reinvestment facility to redirect dividends to buy other stocks.

Always been easy to deal with, and their reporting is good.

report this

Al

Mar 07, 2016 at 11:01

Ditto about fixed charges = good for larger savers - even after the hike. Chose them for this and to support local business. Yes the platform is basic but it does most things you want. Always got good service on the 'phone - no foreign voices, well not to me at least! Lots of horror stories about ii even if it is a little cheaper. Was looking to transfer in another ISA from Clos bros but will wait to see the new platform. Only real annoyance with the current is that it opens 3 new windows just to login.

report this

David B

Mar 07, 2016 at 17:46

I have been with them for years and I find them excellent. Reliable, accurate, responsive and clerically competent. Good value too if you have a reasonably sized portfolio (even after the increases). My only grouse is that, despite begging and pleading, they still don't provide the ability to setup a stop-loss facility within the dealing system.

report this

AA

Mar 07, 2016 at 18:16

25% this year, 50% next year one wonders where it will end!

report this

RippedOff

Mar 08, 2016 at 19:06

The competence of the person you speak to varies from very good to plain ignorant (dictionary definition). On one occasion I had to explain how to use their website to find details of a fund. When I told her what I thought she said that ATS do not provide advice. I wasn't asking for any. I wrote to ATS and suggested that this person should not answer the phone until adequately trained. I had to insist they listen to the recording and then I had a half hearted acknowledgement (in case I made a claim?). Still not arrogant as was Mr Hargreaves but I am looking around. They all realise that the hassle of transferring puts people off this. So if the FCA sorted out transfers, this would make them all sit up.

report this

Ibsymon

Mar 09, 2016 at 19:50

I cannot say that I am happy with these increases but at the same time I do not recognise much of the negativity being set at the door of AT/ATS.

I've seen many platforms being compared in the Financial Press and Alliance only seems to come into it's own when an investor has a reasonable portfolio. I agree the charges on Investment Accounts are high, which is why I have none with them.

Remember the wide range of investments you can add to an ISA ~ if it is eligible (Government/HMRC rules) then ATS probably allows it too. Not all platforms are equal. You may also participate with most Corporate actions free of charge; transfer dividends to another investment purchase or a deposit/online dealing account, all free. Personally, I pay £7 for any sized purchase or sale and remember they hold discounted charge days each year - £5 per deal. I'd like to see this conducted perhaps every quarter and this is a good time to realign a portfolio. I missed the opportunity in 2015 but that was my own fault.

The new Website will presumably be much better though again, I have not had any bad experiences that would make me run away. I would like to see the 'time-out' period much longer. I get annoyed if, thinking of making a transaction, I make a final check in the research section, decide to buy or sell, only to find I need to login again. Perhaps a simpler login after the initial one would serve a similar purpose. But the same thing happens on most financial sites, such as your Bank online or F&C or Fidelity. I imagine other platforms too but have not tried them. On the whole I feel the Website at ATS is no more difficult than most. Is it not more a question of how it is used?

There was a comparison table in Money Observer (sister company Interactive Investor) and, frankly, I simply could not reconcile the then charges that they quoted with what I pay.

What Investment? has tried too but the article finished with one of the few truths I have seen and that is, at present, it is almost impossible for the average user to compare and decide which platform is best.

I have not yet decided either way but am pleased to note transfers out will be free of penalty charges. This is not a decision to be made lightly. Personally again, my pet hate are platforms who demand x amount of transactions per month or be penalised. I like being able to leave actions to ME and know I'm not going to be hammered.

All platforms need to remember the Client is King!

report this

kenneth hancock

Mar 14, 2016 at 11:54

I have dealt with stocktrade for many years and have only 1 valueless share left

they want to charge me £000s a year to and wont send the cert to me!!!

Any one having same trouble?

report this

report this

kenneth hancock

Mar 21, 2016 at 10:46

Me and my family will be stop dealing with Stocktrade /Brewin Dolphin after over 20years.

And take my complaint to The Fin.Ombudsman.

They are charging me £114 per month for looking after one share worth nothing and will not send the cert to me to burn !!

report this

RippedOff

Mar 21, 2016 at 13:35

kenneth hancock,

Check T&Cs because this is the first excuse FoS will use if Stocktrade is using same (unfairly). Have you asked them to sell and donate the proceeds to charity? Then you can at least stop the monthly charges.

report this

richard tomkin

Mar 21, 2016 at 15:16

I have been looking through the Alliance Trust 2015 Annual Report.The remuneration section makes interesting reading.In the six years from 2010 to 2015 the Total Shareholder Return exactly mirrored the chosen index.Over the same period the Chief Executive Officer's pay went from £0.69 million to £1.43 million.Why? - she was merely hugging her chosen index.I applaud flat fees,and only wish that directors did also.

report this

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

A comprehensive approach to investing in Europe


Making the most out of Europe’s potential means seeing things differently. Learn more about how BlackRock’s focused approach to investing in Europe helps investors unlock the continent’s vast potential.

Watch Now

The Citywire Guide to Investment Trusts


In this guide to investment trusts, produced in association with Aberdeen Asset Management, we spoke to many of the leading experts in the field to find out more.

Watch Now

More about this:

Look up the investment trusts

  • Alliance Trust (Ordinary Share)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them

More from us

Archive

Today's articles

Tools from Citywire Money

From the Forums

+ Start a new discussion

Weekly email from The Lolly

Get simple, easy ways to make more from your money. Just enter your email address below

An error occured while subscribing your email. Please try again later.

Thank you for registering for your weekly newsletter from The Lolly.

Keep an eye out for us in your inbox, and please add noreply@emails.citywire.co.uk to your safe senders list so we don't get junked.

Read more...

Where on earth should you invest in the Trump era?

by Michelle McGagh on Dec 07, 2016 at 11:05

Sorry, this link is not
quite ready yet