WH Ireland is undertaking measures to reduce costs and has started a review of its wealth management arm, including the viability of some of its smaller offices.
Last month, Dan Cowland was hired from Shore Capital as finance director with the remit to ‘squeeze a lot of costs out of the company’, WH Ireland chief Richard Killingbeck (pictured) explained. This includes a review of the firm’s lower net worth accounts
‘We have a high cost-to-income ratio and are focusing on reducing our cost base. We are reviewing our smaller accounts,’ Killingbeck said.
‘We don’t want to close our smaller accounts, but where they are less than £500,000, they should be in a pooled fund. We have not set a minimum but we will look at that – maybe £100,000.’
The review will also extend to WH Ireland’s smaller offices to assess their viability.
‘We are looking at everything. We have some very small offices – one-man offices, which in the current regulatory environment poses some challenges, so we are looking at those,’ the chief executive said.
The news comes after WH Ireland recently launched an office in the Isle of Man, as part of its strategy to grow its discretionary wealth management business.
Elsewhere, its final results revealed a 43% increase in assets under management to £2.5 billion in 2013.
The company is also making efforts to take advantage of the minimum asset requirements larger banks are imposing on smaller clients.
‘The large banks in the private client space are moving up their minimums and that is presenting us with opportunities,’ Killingbeck said.
‘It’s a reflection of what is going on in the industry. The bigger banks are all saying they want clients of above £3 million or £5 million. There is a finite amount of that business and we are happy to pick up the crumbs from their table.’
Share price boost
After a turbulent year, WH Ireland’s share price has almost doubled, up more than 90% over the period, which Killingbeck said reflects a recognition of the changes the business has already made.
‘Personally, I think we are undervalued, but we are a public company so it’s for the market to judge. The market is waiting to see how our interims go.’
The key focus for the company is organic growth, focusing on the three service proposals it offers; discretionary, advisory and execution-only.
‘We are having success with individuals that are wanting to join us and bringing business with them, but also the large banks in the private client space moving up their minimums and that is presenting us with opportunities,’ he added.