John Ventre’s Old Mutual exit shocks industry

The sudden departure of Old Mutual Wealth head of multi-asset John Ventre has left many surprised, even though the team reshuffle following the Quilter Cheviot acquisition makes sense, experts say.

Ventre, together with François Zagamé and Stewart Cazier, will leave Old Mutual Wealth in a restructure of the multi-asset investment team following the £585m acquisition of Quilter Cheviot.

Quilter Cheviot’s Ben Mountain and Old Mutual Wealth’s Anthony Gillham will now lead the combined 24 staff multi-asset investment team as the two multi-asset teams are merged.

Gillham, who currently manages the Old Mutual Voyager Strategic Bond Fund, will also manage Ventre’s Spectrum Funds range as well as the Voyager Funds range with Sacha Chorley.

Tilney Bestinvest managing director Jason Hollands says Ventre’s departure is a surprise for many, especially since the firm has been very supportive in nurturing the fund manager’s image within the industry.

He says: “The news comes as quite a surprise as OMGI have been proactively raising the profile of John Ventre and the team, with regular updates and thought pieces until very recently.”

Axa Weath head of investing Adrian Lowcock also says it is a surprise that Ventre is leaving the firm as he is a significant figure within the group and has a high profile among advisers.

Following the OMGI announcement, Square Mile has removed its recommended rating on Ventre’s Spectrum fund range.

Square Mile says: “Our decision is based on Mr Ventre being integral to the running of the range. Anthony Gillham has assumed responsibility and we plan to meet with him in due course to discuss these strategies moving forwards.”

Hollands says the team reshuffling and the consequent departure of some of its members is simply a “rationalisation of an investment capability,” as after the acquisition of Quilter Cheviot there were some overlapping capabilities between the two investment teams.

He says: “The logic of rationalising the multi-asset capabilities within the Old Mutual group having acquired Quilter Cheviot, is easy to see as this is an area of clear duplication between OMGI and Quilter Cheviot. It also marks a step towards a greater integration of the various distribution and manufacturing businesses within the group, a nudge perhaps towards a more vertically integrating model.”

Lowcock adds: “Whenever a merger or acquisition does occur it usually results in some departures as there are a duplication of roles. So from that point of view it suggests Old Mutual are progressing with the integration of Quilter Cheviot into the Old Mutual Wealth operations and not leaving it run as a standalone business.”

Old Mutual has made a number of acquisitions recently, including investment joint venture Cirilium, as well appointing Richard Buxton as chief executive in August.

Despite the surprise among commentators, experts argue that it is more important to focus on the consistency of the investment philosophy within the newly-formed multi-asset team.

Chelsea Financial managing director Darius McDermott says it is positive that the multi-asset team “will keep carrying on with their range” and that Old Mutual has said no changes will be made to the investment strategy.

He says: “We don’t know Gillham although he has a good track record. However, we think Sacha Chorley will do more of the day-to-day management of the funds.”

AJ Bell investment director Russ Mould agrees that the important thing is the investment philosophy, which advisers and investors will look at very closely.

He says: “People will look at the continuity of the funds’ management but also at whether there will be any changes in the investment philosophy of the funds, which is the most important thing”.

Labour under fire over financial transaction tax plans

Labour’s plans for a financial transaction tax have come under fire amid concerns the policy will “damage growth”.

Speaking at the Labour party conference in Brighton yesterday, CityUK director of policy and public affairs Nicky Edwards said the policy will fail to achieve the stated goals.

Labour leader Jeremy Corbyn has already backed the introduction of a European financial transaction tax of 0.1 per cent on share and bond trades and 0.01 per cent on EU derivative transactions.

Edwards said: “This is being sold as the lovely idea of robbing from the rich to give to the poor, but in fact, it would be precisely the individual consumer and their household that would pay and pay again.

“At every stage of pension saving and with every product people buy, they would have additional cost loaded onto it. It wouldn’t do what it sets out to do, and it would damage growth.”

Speaking on a panel focusing on the contribution of financial services to the wider UK economy, Edwards added that more needs to be done to allow pension firms to better utilise savings assets to boost the economy.

She said: “One of the reasons that we need to have conversations with policymakers about how you regulate the industry so that its safe is so it doesn’t choke the ability to mobilise savings for investment purposes.

“Everyone who has followed Solvency II will know the tensions between safety and investment. I hope we’re moving to a place where the insurance industry in particular is able to put pension savings to work in the interests of growth in the broader economy.

“We are not entirely there yet, but I think we have made a lot of progress.”

Bellpenny pushed to £5m loss by acquisition costs

Advice sector consolidator Bellpenny has reported a loss of £5m for the year ending 31 December 2014, almost doubling losses from the previous year.

Bellpenny recorded a loss of £2.7m in 2013, and blamed the worsening result on costs generated by acquisitions, including the £10m purchase of Torquil Clark.

The deals saw assets under management rise from £1.1bn at the end of 2013 to £2.7bn at the end of last year, while intangible assets on the firm’s balance sheet rose from £15.8m to £33.4m.

However, it also meant that Bellpenny paid a total of £12.3m in initial considerations for purchases, with a further £4.3m paid in relation to prior year acquisitions.

By contrast, the firm spent £5.7m on acquisitions in 2013.

In addition, the average monthly number of employees rose from 97 in 2013 to 224 in 2014, meaning that staff costs also increased sharply from £4m to £8.3m.

Since the end of the financial year, Bellpenny has acquired a further eight businesses for a total of £8.5m funded, in part, by £7.5m of share issuance.

FSCS declares 42 firms in default

The Financial Services Compensation Scheme has declared 42 firms in default, 28 of which are investment and life and pension firms.

The list of 42 firms also includes seven mortgage brokers.

Customers of those companies can now make claims for compensation to the FSCS, which is funded by an industry levy.

The following 28 firms, classified as investment or life and pensions businesses by the FSCS, have been declared in default:

• Standrings
• Montpelier Financial Services
• CPC Wealth Management
• Bonham Wealth Management
• Financial Professional
• Legacy Wealth Management
• Pentyre Investments
• Matthew Round & Co
• Hewitt & Harris Wealth Management Solutions
• Presto Planning
• Planned Exit
• Archer Bramley
• Asquith Hart Financial Management
• Michael Mallen Associates
• Hightree Financial Services
• Newman Wright Financial Advisors
• Select Financial Solutions
• Provision Financial Consultants
• Davinci Wealth Management
• First Action Finance
• W.P.L.C Financial Consultants
• Avidity Wealth Management
• The Joseph Bevan Partnership
• CP Asset Management
• Crisp Financial Services
• Central Investment Services
• The Mortgage Market
• E David Roberts and Co

FSCS head of communications Mark Oakes says: “FSCS protects consumers around the UK when authorised financial services firms cease trading.”

Origo to deliver back office for pensions dashboard

Life and pensions standards body Origo is to develop a pensions register service to power providers’ ‘pensions dashboards’.

The service, designed to slot into firms’ customer portals, will allow customers to see all their pension policies in one place.

The FCA and Government are encouraging pension providers to develop the digital aggregation concept to help customers engage with their savings.

Last week, Money Marketing revealed the Department for Work and Pensions is to delay the roll out of the pot follows member model for pension transfers and could scrap it in favour of a dashboard developed by the private sector.

Origo managing director Paul Pettitt says: “Origo’s Pension Register Service will provide an index as to who holds what and where.

“The service will create a shared index that can be used by government agencies and companies – such as pension providers, platforms, third party administrators, employers, banks, tracing services – to provide their own dashboard capability direct to consumers that they have identified and authenticated as eligible for access.”

Origo is owned by most of the UK’s life companies, including Aegon, Aviva, Legal and General, Scottish Widows and Standard Life.

FCA director Nick Poyntz-Wright exits

FCA director of long-term savings and pensions Nick Poyntz-Wright has left the regulator, Money Marketing can reveal.

As part of his remit, Poyntz-Wright oversaw the supervision of financial advisers. This has now been passed to Linda Woodall, who the FCA announced earlier today has been appointed director of life insurance and advice.

An FCA spokeswoman confirmed Poyntz-Wright has left the regulator to take up another role.

Poyntz-Wright has been at the regulator since 2011. Prior to that, he was chief executive of Skandia UK, now Old Mutual Wealth, for six years.

In December it was revealed that Poyntz-Wright gave the ill-fated media briefing that sent insurer share prices tumbling in March 2014.

It was previously understood that former FCA head of supervision Clive Adamson had given the briefing to the Daily Telegraph about the regulator’s review of closed book policies, as the quotes were in his name.

Adamson resigned from his role in December ahead of the publication of an inquiry into the FCA’s handling of the announcement.

Garry Heath: All roads lead back to unaccountable regulation

One of the biggest challenges we face as an industry is unaccountable regulation. However, even if we were able to completely reform regulation tomorrow the advice sector would still have to resolve some major issues. These are context, productivity and capital.

Context is driven not only by what we are but by what others project onto us. Your client’s attitude to personal finance is probably as much influenced by their parents and grandparents as anything you say.

Grandparents may well look nostalgically at industrial branch advice while their children may feel burnt by direct salesforce advice received in the 1970s. Whatever the attitude, advice was free in all cases. The sector must now get clients to value advice. We are seeing progress but it will take at least a generation.

Productivity, meanwhile, is an adviser’s Achilles’ heel. The only true value an adviser has is in front of their clients. To make this work they need management and, our final issue, capital.

In 2012, I met nearly every private equity house in London. Last week, I met someone who was doing the same thing this year. Nothing has changed. We were both ready to bring a new form of distribution into the UK. We both had great numbers. The biggest challenge? Capital.

The market loves the idea of new players in financial services but will not invest in a sector with such an eccentric and unaccountable regulator. Unless we can access capital, the sector cannot expand or create new ways of bridging the advice gap. Sadly all roads lead back to unaccountable regulation.

Garry Heath is director general at Libertatem