Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Brewin withdraws investment services for sub-£50k clients

Brewin withdraws investment services for sub-£50k clients

Brewin Dolphin is to withdraw investment services for sub-£50,000 clients, arguing the cost of servicing these individuals has become unsustainably high.

Clients affected by the changes are being contacted by the firm and offered execution-only portfolios as an alternative.

‘Letters are going out and services are being withdrawn for investors with less than £50,000. The reality is that many of these clients remain with the firm on an execution-only or non-advised basis, and we want to be able to re-engage them with a compelling direct-to-consumer offering,' said Stephen Ford (pictured), head of investment management.

Ford said Brewin recognised the post-retail distribution review (RDR) advice gap is ‘real, it is here and it has opened up faster and wider than many expected, including ourselves’. As a result, the company is looking into how it can develop a new direct proposition, with its managed funds service at its core.

How to deliver this in a way that does not require face-to-face advice in order to make the offering simplified and more cost-efficient remains the key challenge, Ford said.

In June 2012, Brewin launched a managed portfolio service (MPS) for its smaller clients, headed by Edinburgh-based divisional director John Moore, to drive down the costs of portfolio management among this area of its client base.

At the time, the MPS was offered to 27,000 clients with investable assets between £10,000 and £150,000, although clients with over £100,000 could opt for bespoke management.

Five risk profiles were offered, with a 1.2% management fee plus VAT and no minimum or transaction charges.

The decision to withdraw investment management for sub-£50,000 clients also follows Brewin’s decision to withdraw its advisory dealing service, as a result of regulation back in autumn last year.

Clients were offered advisory and discretionary managed services as alternatives, alongside execution-only and its MPS.

The move helped drive execution-only assets up net £1.3 billion, a 24% increase on the year. Of this, £900 million was in new inflows, while £700 million was transferred from advisory to execution-only, Brewin reported in its preliminary annual results.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play HSBC's Stephen King warns of 'enormous' Brexit deficit danger

HSBC's Stephen King warns of 'enormous' Brexit deficit danger

Brexit will weaken the economy, fail to boost exports and lessen the country's ability to fund its 'enormous' deficit, according to HSBC's senior economic adviser Stephen King.

Play Premier's Smith: electricity and water can be a good mix

Premier's Smith: electricity and water can be a good mix

Exposing your person to electricity and water simultaneously is ill-advised, but what about your portfolio?

Play Citywire 10k: video highlights

Citywire 10k: video highlights

Citywire held its sixth annual charity run last week, which hosted over 200 people and raised £14,000. Here are the video highlights.

Your Business: Cover Star Club

Profile: how to control your destiny in an age of regulation

Profile: how to control your destiny in an age of regulation

‘RDR was good news to us because it aligned our practices with the industry,’ says Courtiers boss Jamie Shepperd

Wealth Manager on Twitter