Watch Out, Fundsters. The UK Wants to Change Fees
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Wednesday, June 28, 2017

Watch Out, Fundsters. The UK Wants to Change Fees

The British asset management and wealth management industries faced their own DoL rule of sorts (the "Retail Distribution Review", i.e. RDR) four years earlier than their American counterparts, and now British regulators are poised to shake up asset management again.

Today the United Kingdom's Financial Conduct Authority (FCA) issued a report arguing "that price competition is weak in a number of areas" in the UK's $9-trillion-AUM asset management industry. The FCA proposes a number of remedies, including "the disclosure of a single, all-in fee to investors," as well as "the consistent and standardised disclosure of costs and charges to institutional investors." If the SEC takes note on this side of the pond, FCA's move could be a preview of things to come for asset managers in the U.S., too.

Bloomberg covered the news, noting that the FCA wants the proposed single fee to include asset managers' upfront estimations of transaction costs and intermediary fees.

It's unclear what Mister Market thinks of the FCA's proposals. The pub notes that share prices in Aberdeen (which is soon merging with Standard Life) slipped as much as 1.2 percent after the FCA's report, and Bloomberg notes that other asset managers' shares are also suffering. Yet Aberdeen's shares have since bounced back and were up 0.51 percent as of 8:40am EST (1:40PM BST).

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