Sipp firm commits to non-standard investments in wake of ban

A Sipp provider has re-affirmed its commitment to offering non-standard investments despite James Hay banning NSIs for new customers. Rowanmoor told newsletter subscribers that: “Despite the recent withdrawal of James Hay from the non-standard investment arena, demand for these assets will continue.“Rowanmoor is committed to offering access to the widest possible range of investments and has the experience, expertise and strength to provide such a service.”James Hay revealed the move last week, saying there was dwindling demand and risk appetite, adding that it made the decision based on talks with advisers.In a message on its website, Rowanmoor stated: “The withdrawal of James Hay from the non-standard investment arena marks a significant shift in the Sipp landscape and further widens the gap between platform Sipps and bespoke Sipps.“The FCA’s capital adequacy requirements for Sipp operators, which came into play in September 2016, has clearly influenced the direction for many Sipp operators, but for James Hay, reduced demand and diminishing risk appetite was cited for their decision.“Complex assets remain central to the investment portfolio structure for some individuals and with longstanding experience in this area this is a market in which we have committed to operate long-term. Rowanmoor, as a bespoke provider, will continue to facilitate holding non-standard investments within its Sipp, SSAS and Family Pension Trust products, as we believe that the opportunity to create a diverse portfolio is a choice that should be available to the more affluent, sophisticated investor.“A contraction in the number of bespoke Sipp providers in the market leaves such investors fewer choices of Sipp operator through which to invest in non-standard investments but it remains vital that those individuals are not only appropriately advised, but that their advisers approach a provider with the experience and expertise to provide such a service and with a fully diverse proposition."That provider may not necessarily be the cheapest but they will have a proper understanding of the asset types on offer, and employ the appropriate risk controls.”Rowanmoor stated NSIs “need strong technical and investment competence to control and administer”.It encouraged advisers to “actively seek assurance from their providers that appropriate regulatory capital and stringent due diligence measures are in place and that they have a commitment to this investment class”.The firm stated: “With a shrinking market there will be opportunities for bespoke providers to carve more of a niche in their specialist fields and for advisers looking for a wide-ranging choice of investments and products that can accommodate their clients’ specific needs.”Other specialists have said there is still an appetite and a place for non-standard investments.Dentons and Mattioli Woods told Financial Planning Today there was still a role for NSIs.James Hay said it will continue to fulfil its obligations with regard to existing NSIs, but it was “not appropriate to continue allowing the purchase of further NSIs”.

Sipp firm commits to non-standard investments in wake of ban

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