The FCA has visited ten insurance companies asking about their supervision of unit-linked funds. It particularly wants to understand how governance is being applied including when it comes to costs as FTAdviser reports.
A Freedom of Information request also shows that within the probe, the FCA asked the firms to list their unit-linked funds, broken down into three different categories – pension accumulation pension decumulation and life-insurance based investments.
It will be interesting to see if the FCA manages to secure better value using the governance route rather than the price cap route. Generally, life offices have successfully asserted that these contracts are in force and should not be subject to retrospective action. This is not small beer. It represents around £1trillion of assets.
It would be goood to know what advisers make of all this. (As a journalist it is also interesting to see that the person who put in the FOI request doesn’t want to be mentioned).
In other news, Russia’s excellent 2019 and continued rally has put it back on the radar of global fund managers says the FT.
Goldman Sachs plans a cash ISA launch but shelves plans to tie up with Nutmeg, which must be a blow to the robo.
I have seen a lot of discussion about the Woodford wind up and return of cash in terms of the losses which investors in the Woodford Equity Income fund are suffering. Does it date from the gating? Investors themselves will, no doubt, date it from the day they invested.
On average, investors in accumulation will receive 55.62p per share while those who have received an income are getting back 47.62p per share.
Investors in the C share class, held by most platforms have lost 28.7 per cent of the value of their assets in the Woodford Equity Income fund over the past five years, 37.2 per cent over the past three years and 29 per cent in the past year, according to data from FE Analytics.
Interesting that Hargreaves Landown Z class investors will get the most returned.
The wind up cost on the main Income fund could be £10.3m with that amount set aside by Link Fund Solutions.
Aberdeen Standard Life says that the former Woodford Income focus fund will reopen to redemptions on February 13th.
Low cost adviser Open Money says it is signing up around 1500 clients a week. It now has around 45,000. One to watch.
St James Place tells New Model Adviser that its advisers will fall outside the changes to IR35.
Zhang Ming, an economist with the Chinese Academy of Social Sciences, says in a recent report that China's GDP growth may drop to 5 percent or even lower due to the Coronavirus.
The FCA has published a video warning that even with a deal between the UK and EU, it is likely that passporting will end at the end of 2020, which may create problems for firms with EU based clients but without an office in those states.