Sipps sector to shrink to as few as 30 firms, experts predict

The Sipps sector will shrink significantly and could reduce to as few as 30 ‘strong’ providers, professionals have predicted. Sipps Professional's sister website Financial Planning Today has been told there will be more consolidation to come after recent buy outs.Rowanmoor was bought by Embark Group, the owner of rival business Hornbuckle, while EPML was acquired by Curtis Banks/Suffolk Life. STM Group has bought London & Colonial and Mattioli Woods acquired MC Trustees.Matthew Rankine, pictured above, director of sales and marketing at Liberty Sipp, said: “In my view, by this time next year there will be about 30 strong Sipp providers. I think this is a good number to create a healthy competitive market, and to provide customers with plenty of choice."Read Financial Planning Today magazine feature on the Sipp sector in full - see how belowChris Jones, principal of Rock Consultancy and a former director at Suffolk Life provided data on the state of the sector at the recent AMPS conference.He reported that 75 firms wrote new Sipps in Q2 2016 before capital adequacy reforms had kicked in, compared with 99 providers six quarters ago in 2015.He cited an FCA report suggesting that the reforms would result in 14% to 18% of providers stopping writing new business and said that, in fact, there had already been a 24% drop so far.There are now 236,000 full range Sipps, and 1.35million streamlined Sipps, his data showed.Jeff Steedman, head of Sipp/SSAS business development at Xafinity, said: “There will certainly be further consolidation in the next 12 months and probably in all areas of the market.“I’m guessing five to ten providers will have exited in one way or another in the next couple of years.”Greg Kingston, head of communications, product & insight at Suffolk Life, said: “There are too many small specialist Sipp providers in the market today, and the recent review of in specie contributions shows how many are simply not up to the required standard.“The original, smaller founder members of the Sipp market rightly remain a concern for the regulator, and they’re most likely to succumb to the regulatory and financial pressures of running a Sipp business to the expected standards.”Elaine Turtle, director of DP Pensions, said: “I think we will see more consolidation and the super Sipp providers will just get bigger and bigger.”Eddie McGuire, managing director of @SIPP, said: “We believe the shake up in the market will continue with fewer providers prevailing in the years to come. As this happens, the old adage of “buyer beware” will be increasingly appropriate.”To read the full article, see the latest magazine by clicking here http://bit.ly/2d21I0G. The Online version will work on most browsers and desktop computers.You can receive advance notification of publication in future - and early access - by signing up to our daily newsletter here.If you are one of the thousands of current subscribers to the newsletter you will be sent a link to the magazine daily as soon as it's published.The new publication features exclusive content not available elsewhere including contributions from leading figures in the worlds of Financial Planning and Paraplanning plus features and insights produced by experienced financial journalists in London.Financial Planning Today's second issue highlights include:• Entrepreneurial Paraplanner Cathi Harrison on growing her business• Insights from PFS chief executive Keith Richard and Succession boss Simon Chamberlain• Exclusive Report on Platforms post the Cofunds takeover• New Investment and DFM section with 180+ DFM providers listed• A special News Report on Sipps after the capital adequacy reforms• News summaries, company news, professional body events coming up...The magazine has been launched by Portfolio Publishing, publishers of Financial Planning Today website and Sipps Professional websites, both of which carry daily news to thousands of professional financial advisers. Our launch issue of Financial Planning Today received excellent feedback.Financial Planning Today Publisher and Editor Kevin O’Donnell said: “Our first issue was extremely well received and we're delighted to offer the only publication exclusively for professional Financial Planners, Paraplanners and Wealth Managers. Our second issue is packed with valuable features, analysis, comment and business tips to help all professional advisers."Financial Planning Today magazine is an invaluable read for all professional advisers who want to keep up with their profession and learn from their peers. The emphasis is very much on professional and business growth and readers have told us they value this hugely."For editorial enquiries please contact: This email address is being protected from spambots. You need JavaScript enabled to view it. . For advertising enquiries, including recruitment advertising, please contact: This email address is being protected from spambots. You need JavaScript enabled to view it. or 01895 678629.

Sipps sector to shrink to as few as 30 firms, experts predict

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