S&W eyes family office growth as banks withdraw Thursday 15 Oct 2015

S&W eyes family office growth as banks withdraw

Smith & Williamson Investment Management (S&W) believes the time is ripe to target growth in the family office market, as banks withdraw from the area.

As several large banks scale back their wealth operations and families grow disillusioned with the service they have received from them, S&W partner Chris Kenny is hoping the firm’s growing family office division can reap the benefits.

S&W’s family office business offers a range of services, spanning investment management, financial planning, tax expertise, alongside providing a holistic view of all family assets.

‘A huge amount of wealthy families have become disenfranchised with banks. They are given homogenous and standard products but in fancier packaging,’ Kenny (pictured) said.

‘Also, ultra high net worth families and individuals think discretion and confidentiality is important. There is a growing worry about how that is achieved in the biggest banks.’

Kenny expects ‘capital creation events’ in the business world, such as IPOs and M&A, to create wealth and provide a source of new clients in the future.

The partner adds that in an increasingly global market, S&W has received a growing number of enquiries from different jurisdictions.

‘We will be spending more time and money reaching beyond our traditional domestic UK market and looking abroad,’ he said.

‘We need to raise our profile in different jurisdictions. We spend a lot of our time in other jurisdictions, so we are already making contacts abroad.’

The service offered abroad will remain the same and S&W has no plans to open overseas offices as part of this expansion.

The wealth manager identified this market as a ‘key area of focus’ after it reported a 9.4% rise in profits to £31.5 million over the 12 months to the end of April 2015. Assets under management rose by 8.7% to £16.3 billion over the same period.

Kenny said the firm is trying to hire someone to expand the firm’s family office client base in other jurisdictions.

‘It is a really important role,’ he said. ‘A few years ago, we first came out and branded this as family office. We did quite well and won some awards, which was nice.

‘Now we are planning to make a senior hire to lead this. We think this is key to raising our identity.’

He added that wealthy families now have greater access to family offices through the increased number of consultants in the market, many of whom have left the big banks.

He said: ‘We are also seeing the rise of consultants. They have been part of the story for a long time but they are really growing now. They will recommend family office services such as ours so more clients are making informed decisions about who to talk to.’