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Lenders need to adopt a more pragmatic long-term view to lending to overcome uncertainty in the market, according to&nbsp;Kevin Bailey, managing director at&nbsp;Wessex Investment Management.

Lenders need to adopt ‘more pragmatic’ long-term view to lending

Many in the financial services industry are bracing themselves for the fallout from another interest rate hike.

“If rates are raised further on Thursday, the future is bleak”

Ahead of this week’s Monetary Policy Committee meeting, UK newswire, Newspage, asked a selection of financial services experts whether they think the Bank of England should increase rates this week…

Property experts warn if the Bank of England raises interest rates further ‘the future is bleak’

Ms Truss has thrown in the towel after just 45 days in office.

Liz Truss resigns as Prime Minister

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Kevin Bailey

With over 1,300 advisory firms scrabbling for data to satisfy the FCA Retirement Income survey, you would think CRMs would be able to provide the information needed. It appears not. Intelliflo, the largest CRM provider out there is reportedly beginning its work now on how to provide the data for firms. Too ****** late for those that have to satisfy the FCA's "request" with less than two weeks to go. The FCA signposted its intent over 3 years ago. There has been more than sufficient time for CRMs to ensure that the appropriate reports could be produced. If CRMs are not keeping up with regulatory requirements in good time, how can they be serving the advisory community?&nbsp; &nbsp;<blockquote>Are CRMs failing the advisory community?"</blockquote>

Are CRMs failing IFAs?

I recently “celebrated” 30 years working in financial services. Throughout this time there have been many changes, not least in Regulation. When I started, we had joint regulators, the Financial Intermediaries, Managers and Brokers Regulatory Association Limited (FIMBRA) and Life Assurance and Unit Trust Regulatory Organisation (LAUTRO) which subsequently combined to bring us the Personal Investment Authority (PIA), which evolved into the Financial Services Authority (FSA) before, as it is now, becoming the Financial Conduct Authority (FCA). Throughout this time the one constant has been the approach from life assurance companies and their apparent disregard of their responsibilities to client servicing and, to use current regulatory parlance, good client outcomes. Why do I say this? We had the exploitation of homebuyers with the proliferation of endowment sales but the ongoing management of the underlying funds was anything but; the majority of life managed fund managers seemed to abrogate their responsibilities when it came to investing. Many policyholders thought “with profits” meant the investments would provide good returns and help them to repay their mortgages at the end of the 25-year term.&nbsp; Unfortunately, too many policies fell short of their targeted return as annual bonuses reduced significantly and the terminal bonus followed in a similar fashion. Companies simply washed their hands and waived away any complaint about mismanagement simply saying “it’s the markets, nothing to do with us” yet too many of their funds were regularly ranked 3rd or 4th quartile that is, significantly underperforming. We have seen much consolidation amongst life companies, for example Clerical Medical effectively ceased trading in the early 2,000s yet still has clients in its life funds that it fails to service appropriately. Aviva, formed through an amalgamation of Commercial Union and General Accident, Friends Life (in part) and Norwich Union still suffers through its lack of integrating systems.&nbsp; Phoenix Life and ReAssure are two more consolidators that have bolted together various companies but continually fail to provide good ongoing service to clients or “customers” as most life companies refer to them. It is as if the majority of these companies are still working with a basic ledger and quill and ink more akin to Scrooge than fully integrated software systems one would expect of a “leading company” as many claim to be. And have you tried calling these companies? More often than not we’re on hold for almost an hour listening to tinned music, the obligatory “your call is important to us” and “due to unprecedented call volumes” before getting through to be told that the average turnaround for providing information is 17 working days (admittedly a big improvement from 2020 and 2021 when Clerical Medical topped out at 92 working days!). But, perhaps the most galling of issues, is how life companies are treating clients that took out whole of life policies on terms issued and premiums calculated by actuaries who, we are told, know a thing or two about these matters. The last two to three years has seen significant increases in premiums at review times. We are not talking 10%, 20% or even 50% but in some cases increases of over 100% and worst case over 400%. These are for clients for whom, at inception, the life companies would have calculated their premiums on their expected costs, mortality and morbidity rates and underlying investment performance if unit linked. How can these companies get it so wrong or is it simply a deliberate move to increase policy premiums to such a level that clients cancel the policies as they’re totally unaffordable? Thereby NOT ‘Treating Customers Fairly’ nor providing ‘good client outcomes’.&nbsp; Is the regulator interested? Probably not, not in the way that we as advisers would expect it to be. And that is a major issue that isn’t going to be solved anytime soon. &nbsp;<blockquote>Life companies continue to give two-fingers to "treating customers fairly" "</blockquote>

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