Good morning and welcome to your Morning Briefing for Wednesday 11 December 2024. To get this in your inbox every morning click here.
Consolidation of consolidators ‘inevitable’
The mooted “consolidation of consolidators” is an “inevitability”, Radiant chief executive Simon Cogman-Hellier has insisted.
There are 34 venture-capital-backed consolidators in the advice space currently.
Many market commentators believe that, as more advice businesses are bought up and the pool of vendors shrinks, consolidators may start to cannibalise each other to grow rapidly.
Warning against pensions ‘time bomb’
UK investment platform and pension provider, TILLIT is calling on the government to raise minimum pension contributions to tackle Britain’s looming retirement crisis.
Chancellor Rachel Reeves has previously initiated discussions about increasing contributions inspired by the Australian system, yet no changes have been made.
While Australia requires employers to contribute 11.5% into workers’ pensions, the minimum contribution rate in the UK is 8% and only 3% must come from the employer.
CGT planning at the end of a pivotal year
Capital gains tax (CGT) receipts rose sharply in October ahead of the Budget, the latest data from HM Revenue & Customs shows.
These amounted to £251m – a 44% increase on the £174m recorded during the same month last year. Similarly, September receipts were up by almost a third from the £192m recorded in 2023, illustrating a sharp jump.
What we can say with near certainty, says FSL’s Michael Edwards, is that there will be a significant rise in the numbers of people pulled into scope for paying CGT year on year.
Quote Of The Day
There has never been such a strong trend, driven by the fundamentals of innovation and disruption, running in tandem with a huge technical trend, such as the rise of passive investing
– Mark Hawtin, head of Liontrust’s Global Equities team, reflects on the past year and gives his expectations for 2025
Stat Attack
New research from Pureprofile with wealth managers and financial advisers who collectively manage £161.5bn in assets shows they believe newly launched wealth managers will lead an increase in flows into investment trusts.
This is because they are able to use their smaller scale to be nimble and pick investment trusts, not because of their size but because of the opportunity they represent.
31%
say they are taking advantage of the limited liquidity of investment trusts that prevent some of the bigger wealth managers from getting involved.
14.5%
Vietnam is showing strong signs of recovery with trade surplus hitting the highest level in four years – with exports up 14.5% year-on-year.
12.4%
Amount by which imports are up year-on-year.
7.9%
Amount by which retail sales have grown year-on-year.
10%
Collectively, this has led to the prime minister assigning a budget revenue target for 2024 to exceed 10%.
95%
The prime minister has also been urged to increase the progress of public investment disbursement to achieve the 95% 2024 target to support further economic growth.
Source: Pureprofile
In Other News
Canada Life has been awarded a financial strength rating of ‘Superior A’ – the highest accolade possible – across each of its international life companies, from the financial analytics and independent ratings specialist AKG.
Canada Life International Ltd, CLI Institutional Ltd, and Canada Life International Assurance have all been upgraded to the top financial rating in the latest assessment.
As well as financial strength, the companies were assessed on their service, image and strategy, and business performance.
The assessment areas that inform the overall ‘Superior’ rating, were scored out of a possible five stars. Each company achieved the maximum score against all categories.
Canada Life International Ltd has achieved a five-star rating in service and business performance since 2004, which is unmatched by any other offshore provider.
For the past 10 years, since 2015, Canada Life International Ltd, CLI Institutional Ltd, and Canada Life International Assurance have all achieved a five-star rating across all categories of service, image and strategy and business performance too.
Julius Baer International (JBI) has opened a new presence in Glasgow. The office will be located at 1 West Regent Street, Glasgow, G2 1RW.
The move is part of JBI’s regional expansion strategy and aims to support further growth in the Scottish market.
In 2018, the business opened its first office in Edinburgh as part of its commitment to offer a bespoke service to clients in Scotland.
The Glasgow office will undertake investment advisory and wealth-planning advisory activities, as well as client relationship management activities, ensuring even higher proximity to clients in Scotland.
With regards to the firm’s broader regional presence in the UK, JBI is also looking to move into a bigger office in Leeds during the course of the first quarter of 2025.
The new office will be at Globe Point, Leeds’s Temple district.
Qatar’s $500bn wealth fund targets bigger deals as LNG windfall looms (Financial Times)
Monthly rent soars by £270 since pandemic, says Zoopla (BBC News)
The UK stock market now trails Oman and Malaysia in IPO rankings (Bloomberg)
Did You See?
The key thing clients value from advice are trust and peace of mind, according to research conducted by Boring Money.
Together, these crucial elements were identified as providing around 26% of the total value of advice.
Abrdn’s Alastair Black believes that, for advisers to effectively deliver this peace of mind, they need confidence their operational processes can cope with what’s thrown at them and that their suppliers will work with them, adapt to changing needs and invest in the future, too.
That’s something that’s been challenged this year across the sector, he claims.
Firms have been buffeted by persistent economic headwinds, political uncertainty and major policy changes. Inflation has strained firms’ margins everywhere from staff costs to energy.
The uncertainty of the general election, the bedding in of a new government and, most of all, the hotly anticipated first Budget of Labour’s current tenure has demanded additional resource from firms to review and adapt client plans, as well as time spent reassuring them.
