Industry watchers at odds over effect of fees changes at Brewin Dolphin
WEALTH manager Brewin Dolphin has reported a loss of customers as a result of its shift to a fee-paying model ahead of new rules affecting the industry next year.
The firm said its assets under management were down 3 per cent to £25 billion in its third quarter, the result of collapsing share prices and small net outflows of around £100 million. Income for the quarter to 30 June 2012 was 4.4 per cent higher than the comparative period last year to £66.8m.
Owen Jones, an analyst with Shore Capital warned that the company’s shift to fee charging “will prove to be too much of a paradigm shift for most clients to take on without a notable improvement in service and/or performance”.
He added: “We continue to forecast outflows as a result of this fee change for Brewin.”
However, Stuart Duncan at Peel Hunt noted that clients moved about £50m from managers at Brewin as a result of its new charges ahead of changes proposed by the Retail Distribution Review.
He said: “We expect attrition levels to remain relatively low as the value added service provided by wealth managers is competitively priced relative to other investment propositions”.
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