Adjusting to a new operating paradigm
And just like many other service providers, financial advisers are finding new ways to adapt and operate.
For example, many financial advice firms are already enabling employees to work from home, while clients and advisers alike are being supported with online content, regular communications, and webinars.
Unfortunately, face-to-face meetings are impossible or ill-advised for most clients; however, advisers have responded to the challenge by setting up telephone consultations, Skype messaging and video-call sessions to help clients stay informed and, crucially, disciplined during the crisis.
But with regulatory requirements not immediately designed to cater to the crisis, there are concerns that some directives could lead advisers into uniquely challenging territory.
The Financial Conduct Authority (FCA) said that it expects firms “to be taking reasonable steps to ensure they are prepared to meet the challenges coronavirus could pose to customers”.*
To this end, it has emphasised the need for firms to prioritise clarity and transparency while at the same time ensuring they stress-test so that they have the resilience to continue. The regulator also said that it would consider delaying or postponing any regulatory activity that is not integral to customer service and market integrity.
The FCA response stated that the organisation is “ready to take any steps necessary to ensure customers are protected and markets continue to function well”. *
MiFid II and extra stress for wealth management firms
Keith Richards, CEO of the Personal Finance Society (PFS) said, “Business continuity plans are being put to the test as financial advisers ensure they can continue to meet regulatory requirements and deliver the service agreed with clients while trying to delay the spread of the coronavirus.”**
However, he warned that the Markets in Financial Instruments Directive (Mifid) II is creating unsustainable levels of pressure and stress at a time when market volatility is at a peak. He added that the PFS would stay in contact with government and regulators regarding the impact as challenges in serving the public may continue to arise over the coming months.
Blacktower Financial Management Group – trusted advice in difficult times
Blacktower’s experience of helping clients to weather uncertain times has been honed over numerous financial crises during recent decades. From the dot.com bubble through to the 2008 crash, the Eurozone crisis and Brexit, our clients rely on us to help them stay disciplined and secure, while always remaining committed to long-term financial prosperity.
Blacktower Financial Management Ltd is authorised and regulated by the Financial Conduct Authority. Registered in England No: 3500648. Blacktower Financial Management (International) Ltd is licensed in Gibraltar by the Financial Services Commission (FSC) Licence No: 00805B. We are committed to providing clarity and transparency throughout the current crisis.
Contact us today for more information about how we may able to help you.
* https://www.fca.org.uk/firms/information-firms-coronavirus-covid-19-response
** https://www.thepfs.org/news-insight/media/press-releases/articles/pfs-plans-for-coronavirus-lockdown/91237
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
The UK government has admitted there are not enough pension transfer specialist advisers to deal with demand, particularly in the case of more complex transfers into overseas pensions. This was the government’s response in March to a consultation launched two years ago, on whether the need to take financial advice, introduced with pension freedoms, created difficulties for overseas residents – residents such as those living in Cyprus wishing to transfer their pension savings from the UK to a qualifying recognised overseas pension scheme (QROPS).