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The great RDR polarisation effect
by James Phillipps on Oct 31, 2013 at 09:51
‘At Barclays I started the new model, launching its private bank from scratch, and it was copied by all of the industry,’ she said. ‘The new model for clients going forward is going to be small owner-managed companies that look after your money, provide conflict-free advice and don’t use relationship managers. This will be the next cycle.’
Max Thowless-Reeves, a founding partner of Sorbus Partners, agrees. He is well positioned to comment, having quit UBS to launch the boutique last year.
‘The lower end of the market addresses different needs – some are happy with online services, others attach strong value to companies having a physical presence near them,’ he said.
‘At the UHNW end of the market, it is inevitable that there will be an exodus to boutiques. While I’m not sure it will be the prevalent model, it reflects the needs of major clients. There will be a plethora of models to suit their individual needs, but the trend out will be inevitable and is already evidenced.’
However, Penny Lovell, head of private client services at Close Brothers Asset Management, believes a single wealth manager can still successfully service the whole spectrum of clients, particularly companies that offer both financial planning and discretionary management.
‘There is a huge market opportunity across the board. For some of those clients that have larger portfolios and larger families that have become dissatisfied with a funded approach, they are now able to look to Close to provide really good segregated bespoke portfolio management at £1 million plus,’ she said.
‘If you look at some of those families with £10 million plus who are being encouraged towards funds, that is a huge opportunity for us to really provide a great family office platform.
‘And the fact that our financial advice side is growing on the high net worth and mass affluent side is a testimony that there is a huge need and opportunity as well.’
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