Affluent investors abandon traditional wealth managers

Lorna Bourke

As the big banks write off billions, the dissatisfied ‘new rich’ are switching to the rising stars among the smaller independent banks, says Lorna Bourke

Steel is also unimpressed with private banks. ‘I bank with Adam & Co, but I don’t let them manage my money. They offer a good personal banking service, which I like. But as soon as you go into the high-street banks, you get mugged. It is amazing how many people we have seen who have been sold property bonds in the 12 months before the credit crunch. The average client who comes to us from the banks has been raped so many times they don’t trust anyone. The high-street banks don’t understand pensions or tax planning.’ Personal service is paramount. ‘Our typical client has £250,000 plus to invest. We always ask people what they are trying to achieve and the relationship is important. They have to feel that we are right for them.’

Steel takes the investment side very seriously. ‘We spend 5,000 hours a year on research and we invest heavily in this with independent firms such as Ned Davis in the States. We see a whole range of indices. One of the most reliable measures is investor sentiment. When you see extreme pessimism, that is the time to buy,’ he says.

Lorna Bourke is former personal finance editor of the Daily Telegraph, the Times and the Independent. She writes for Citywire and the Evening Standard