Sipp consolidation is inevitable warns provider

A pension provider has warned that the new capital adequacy requirements, while not as punitive as feared, will still lead to consolidation in the sector. David Littlewood, development manager at Walker Crips Pensions, commented on the recent capital adequacy requirements for Sipp providers.He said: "The recent capital adequacy requirements will continue to put a strain on Sipp providers along with new legislation changes. Sipp and SSAS providers have always operated in a specialised space but there is growing concern that bespoke Sipp operators may leave the marketplace due to regulatory risk which is ever increasing." {desktop}{/desktop}{mobile}{/mobile} He believes that smaller, most specialist Sipp providers will be hit most.He said: "We estimate that the smaller, bespoke Sipp providers are likely to be hit the hardest, with fees rising and flexibility curtailed to protect margins. The number of entrants that exit the market will not be as high as first predicted due to the change on UK commercial property which will become accepted as a Standard asset. Providers who have already invested in greater system efficiency and controls will respond better to the latest requirements."Many will be reassessing their business strategy and business plans. It is an interesting time for the industry with the pension landscape once again changing and with consolidation still on the table."

Sipp consolidation is inevitable warns provider

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