Brewin hit by rule change

Wealth manager Brewin Dolphin saw a 5% fall in income in its first quarter, ahead of new rules which will impact on the sale of certain financial products under the Retail Distribution Review (RDR).

The fall is compared to figures for the third quarter of 2012, with the group citing the “ongoing reduction of trail income” as the primary reason for the fall.

The company, which employs around 370 at its Newcastle office, did however see its income increase 13.7% to £67.8m on the same quarter last year.

Under the RDR, new rules will prevent the sale of financial products which provide ongoing commission to advisers. Brewin said its shift to a new RDR-compliant fee-paying pricing model had been “slower than anticipated”.

The group added: “The recovery in the commission levels from the sharp falls experienced in the first quarter of the last financial year has stabilised and first quarter total commission income was in line with the average for the final two quarters of the previous financial year.”

Total assets under management remained largely unchanged at £26bn despite a £200m outflow from its advisory funds under management, which the group cites as a result of its “ongoing service reviews as a result of the move to new pricing” and a transfer of £100m to its execution-only service.

The company said it is currently in a period of consolidation after a period of “expansion-led” growth in recent years.