SIPPs downturn reversed by surge in transfer business

Pension investments rose by 66.3% year on year in the third quarter to hit £13.4bn fuelled by transfer business, particularly transfers to SIPPs, according to analysis from intermediary database provider Equifax Touchstone. Despite positive quarterly figures overall, total SIPP sales (excluding transfers) fell, decreasing by 4.1% on Q2 figures (£111.7 million) suggesting that without pension transfer business SIPPs saw a relatively poor quarter.Overall, however, it appears that the economic uncertainty has not dented the pension market which continues to grow, spurred by a boom in pension transfer business. Equifax predicts the pension transfer boom will continue.Transfers across all products rose by 54.3% year-on-year (£2.2 billion) and 5% (£304.5 million) during the quarter to reach £6.4 billion. SIPP transfers increased from £3.5bn the previous quarter to top £3.7bn in the third quarter.Equifax said pension investments overall increased by 2.8% (£363.7 million) from the previous quarter.According to the data, which covers 90% of the UK’s leading life and pensions companies, total pension investments excluding transfers reached nearly £7 billion in Q3 2017, a marginal gain of 0.9% (£59.2 million) on the previous quarter and a significant increase of 78.9% (£3.1 billion) year-on-year.John Driscoll, director at Equifax Touchstone, said: “Pension investments during the quarter have remained extremely positive, building on strong performance throughout the first half of the year. Inflows remained resilient to political and market uncertainty, buoyed by strong performance of stock markets.“Although speculation leading up to the Autumn Budget may impact Q4 figures, the lack of legislative change within the final Budget will have ultimately stabilised the pension sector. In the final quarter of the year we expect to see high volumes of pension transfers persist; defined benefit transfers in particular will continue to soar as savers look to benefit from temptingly high transfer values.”

SIPPs downturn reversed by surge in transfer business

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