Report reveals falling SIPP provider profits ahead of cap ad deadline

FinalytiQ releases Financial Stability Report

Jenna Towler
clock • 5 min read

Falling profit margins at non-insured self-invested personal pension (SIPP) providers should raise due-diligence concerns for advisers ahead of capital adequacy rules coming into force, analysis from FinalytiQ has said.

Its Financial Stability Report, written in conjunction with SIPP industry expert John Moret, said pre-tax profit margins of non-insured SIPP providers dropped from an average 30% in 2012 to 20% in 2015. The in-depth report flagged potential problems for certain providers ahead of the introduction of SIPP capital adequacy rules on 1 September. The report analysed large, mid-sized and small providers operating in the SIPP market and found 13 of the 18 providers who responded - that make up more than 90% of the non-insured bespoke SIPP market - were profitable, while five were loss-makin...

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