Twitter icon Email alerts icon Latest News RSS icon Magazine icon Stay connected:

View the article online at

Should Barclays’ sub-£500k arm be applauded or abhorred?

by Danielle Levy on Jan 20, 2014 at 10:02

‘If I find the right investment managers who want a home, I would be very happy to take on people with clients with less than half a million pounds. I still think it is a lot of money. We are sitting here with open arms and saying “we think you are important”,’ he added.

Richard Whitehead, chief executive of boutique Dart Capital, echoes Howard Smith’s sentiments. ‘I think the decision they have made is incredibly arrogant. There are lots of well run and well managed wealth management businesses that would be perfectly happy to look after the needs of these individuals,’ he said.


Barclays’s open recognition that it wants to service its smaller clients more cost-efficiently flies in the face of the assumption that larger organisations can provide economies of scale.

Consultant Michael Maslinski points out that banks have historically struggled to provide a viable service for smaller clients due to the bureaucracy associated with them and the fact that management is distant from the end-client.

‘Sometimes these [smaller] businesses are capable of providing both the service and advice in a more cost-effective way than the big organisations that have all of the bureaucracy required to show that you know your client to your boss and your boss’s boss,’ he said.

‘It is difficult when management is very remote from the client. So much of the cost in these organisations is servicing that internal system.’

Maslinski is supportive of Barclays’ new division, arguing that the industry ‘should be more honest about what they can deliver to whom’.

‘We have all known that for some time clients with sub-£500,000 can’t afford the advice that is of a calibre worth having. Frankly, this is an acknowledgement that this is the case. I would say £500,000 is quite a low cut-off. It probably should be double that,’ he said.

A chief executive of a medium-sized wealth management company, who would prefer not to be named, has also welcomed the move, describing it as an ‘intelligent decision’.

Sign in / register to view full article on one page

11 comments so far. Why not have your say?

D&W Consulting

Jan 20, 2014 at 10:27

Yet again a bank treats customers with reference only to their wealth. They have completely missed the rich advice opportunities which would have profited both the client and Barclays!

report this

Bob C

Jan 20, 2014 at 14:14

Great opportunity for the rest of us to show these 'customers' that there ARE investment firms interested in providing a full client service, irrespective of how much money they have.

report this

Anonymous 1 needed this 'off the record'

Jan 20, 2014 at 14:18

well they have to do whatever it is commercial to do. it doesn't initially sound good but if they can't make it pay for their shareholders then their decision is one that is sound. it costs a lot to give good financial advice.

report this

Anonymous 2 needed this 'off the record'

Jan 20, 2014 at 14:37

So how does this leave the principle of KYC?

report this


Jan 20, 2014 at 14:38

Barclays will in time regret the day they have made this decision . Sledgehammer to crack a nut comes to mind . £ 500k in most businesses eyes especialy wealth management is a lot of money and the opportunity such a client can provide to do other business is enormous .

The value of "relationship banking" is completely lost on Barclays do they not realise that clients with 400/50k are bound to have other assets.

Time will tell -- and to late I fear

The damage is being done both in practice and reputation -- so difficult to reecover .

not good for motivating staff either

report this

james field

Jan 20, 2014 at 15:52

Whilst the commercial decision is just that, it is a very short term view and increasingly confirms what many have said about larger institutions for years not wanting, nor being able to afford to service clients below half a million pounds because of their own inefficiency - except of course, to sell their own off the shelf products which, to my mind, is neither best advice nor honest in the way it is delivered.

Why not go the whole hog and write of anyone with less than five million?

report this

Nick McBreen

Jan 21, 2014 at 12:53

Nothing new here then--same old same old bank "advice" model lives on!

report this

Jack Lawton-Willett

Jan 22, 2014 at 09:39

I may be wrong here - however, as I see it, banks and building societies for too long have focussed on getting money in through the door. Their processes for looking after existing clients are woeful and the measures that are put in place for bonus take little regard for looking after existing clients. How many of us are bank clients - and HNW bank clients at that - and how often do we get a call?

Love them or hate them, at least Barclays are doing something different and it could be argued that at least customers (date I type clients?) now have an opportunity for regular contact - even if it is over the telephone. I suspect that they will still have field based advisers to swoop in and advise where there is a requirement Let's face it - stochastic modelling over the phone can't be that easy - nor explaining a 128 page reasons why document!

We have about a 10 year window IMHO for face-to-face advice in the current manner. No doubt advice will be conducted and transacted on some form or smart app sooner than we think. I suppose what Barclays are trying to do is adapt to that world in bite sized chunks. They may have got it wrong, however, at least they are having a go.

For the rest of us, there is a current massive opportunity. With banks and building societies continuing to focus upon new business (which mat include charging fees for moving the same fund from an old charging structure to a new one - with financial benefits after 5 years) - there are masses of people out there desperate to sit down and obtain rounded, (I'm going to use THAT word) holistic advice from an experienced adviser not associated with their bank or building society.

report this

Barry Bennett

Jan 23, 2014 at 17:14

Good news.

report this

Guy Usabreak

Jan 25, 2014 at 09:43

Good to see Barclays taking a realistic decision.. The regulatory costs which have been piled onto the industry require new thinking to keep the costs reasonable for customers who want or need advice. For those who can DIY lots of interesting new ETF's and low cost investment trusts out there to cut out the greedy and often inefficient middle man.

report this


Jan 25, 2014 at 19:31

Typical bank thinking they are to big to fail.

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:

Sponsored Video: Bringing it all back home

As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.

Today's top headlines

Sponsored Video: Barings on investing in Frontier Markets

From Nigeria to Pakistan and from Kenya to Kuwait, frontier markets are catching investors' attention as never before.

More about this:

Look up the shares

  • Barclays PLC (BARC.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them

More from us


On the road

Click here to find out more from the Audience Development team.

Sorry, this link is not
quite ready yet