Towry to cash in on shake-up in sector

Andrew Fisher said “a seismic shift towards a fee-based proposition”, triggered by the retail distribution review (RDR), will allow Towry to make acquisitions and recruit.

The Financial Services Authority’s RDR is forcing big regulatory changes on the market for independent financial advisers in an effort to protect consumers, with firms having to charge fees instead of taking commissions from 2013.

Mr Fisher also said he expects to float the business in the next 18 months to two years, but that the timing would depend on when the public market becomes “less volatile or indeed open”. He said the purpose of a flotation would be to raise the company’s profile and fund continued expansion.

Towry recently relocated its office in St Paul’s Street in Leeds to the £10m Highcross development Toronto Square, taking over the fifth floor of the building on a 10-year lease. The office currently houses around 50 staff, while Towry employs over 700 people in total.

Mr Fisher said the move was arranged “to allow for expansion” and to ensure the regional hub was “fit for current purposes”.

He added: “We are looking to add more advisers, so more people who will be dealing with clients, and we’ll certainly add more wealth planners. And we do a lot of work for our Towry Financial Review Service here for the country so we probably expect to expand that as well.

“I would certainly expect to increase by 20 to 30 per cent over the next couple of years.” The Towry Financial Review Service offers clients a regular review of their financial plan and a valuation of their assets, charged at a fixed fee.

The RDR should open up opportunities for Towry, its clients and the industry as a whole, according to Mr Fisher. “We’ve been fee-based for seven years now but the whole industry has to move that way from January 1 next year.

“We think some people will exit, I think the various big banks will probably look to exit, certainly the affluent part of wealth advice. And others may choose to retire and not carry on in the area.

“For us we think there’s a good opportunity to expand through recruiting those people who aren’t working for firms that carry on anymore, to look after clients who find their current advisers don’t do the business, and we also think there’s probably going to be an opportunity for acquisitions.”

Mr Fisher added: “It brings huge benefits for us, but I think more importantly it has huge benefits for the clients. To have an advisory business which is based on acting as the agent of the client is in my view fundamental.”

He expects growth in the business to be “significant” this year, and said that demand for professional advice will only increase as markets become more volatile and taxes rise.

Mr Fisher said: “We do believe that clients do need professional advice and we think there’s not enough supply of professional advice.

“So the clients need advice, and then you look at the supply side, because of the regulatory changes, because of the need for people to become professionally qualified, because of the need to move to a fee-based model, that will probably stifle supply.”

The key to investing well is diversification, said Mr Fisher, who added: “At any one time our investors will have an exposure to equities, bonds, alternative investments including commercial property, both here in the UK, in emerging markets, in the major other global capital markets.”

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