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Should Barclays’ sub-£500k arm be applauded or abhorred?
by Danielle Levy on Jan 20, 2014 at 10:02
As Barclays starts to transfer its sub-£500,000 clients into a new ‘lighter touch’ private clients division, senior figures in the industry are divided over whether the bank’s decision should be applauded or abhorred.
Some say sub-£500,000 clients deserve more than what the private clients division will offer in terms of service. As revealed by Wealth Manager in November of last year, clients will now be handled out of call centres in Glasgow, Birmingham and London. They will be given a new point of contact, known as a private client services manager, who is not regulated but is overseen by a regulated private client manager. The overhaul follows a 35% reduction in private banker headcount this week, down to 180 and a regional management restructure.
The bank said there will be no change to the investment proposition that those in this bracket receive. A spokesperson said the new division will continue to support existing clients ‘through a combination of services including discretionary portfolio management, advisory services and execution-only’.
Wealth Manager understands there will be no change to the charging structure.
Plan branded ‘outrageous’
John Howard-Smith, chief executive of PSigma Investment Management, has branded the launch of the new division as ‘outrageous’, arguing that £500,000 is still a lot of money and these clients should not be treated as ‘a commodity’.
‘This goes back to the age-old argument that people with this sort of wealth should be treated as clients and not customers,’ he said.
‘If we were to go through the same process, would I think it is right to be looked after by a call centre? In my mind you are treating those affected as customers rather than clients.’
Howard-Smith said Barclays’s strategic decision was ‘short-termist’ and he would look to capitalise on any opportunities that may arise from it.
For example, hiring any disaffected staff or attracting new clients, particularly given the potential these clients might have to increase their net worth over time.
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