Skandia has U-turned on its on its decision to close its mirror versions of the Invesco Perpetual High Income and Invesco Perpetual Income funds it offers in its life and pensions business and transfer £640m of assets into a mirror version of Neil Woodford’s CF Woodford Equity Income fund.
Skandia announced the decision last month, claiming the move had been on the back of investor feedback and was in the best interests of clients.
Skandia now says it has listened to further feedback and has been told by advisers that there is sufficient demand for the Invesco funds to remain open.
The firm’s mirror version of the Woodford fund will open in October as planned.
The TERs on both Invesco funds will be dropped from 1.3 per cent to 1.2 per cent on the Skandia Life proposition.
Old Mutual Wealth chief executive Paul Feeney says: “What can I say, but ‘we listened’? What we heard from advisers and their customers was that they welcomed the addition of the Woodford Income fund to our life range and the price we have negotiated for them, but they wanted the Invesco Perpetual funds to remain open. We have acted to keep those funds open at a reduced cost.”
Woodford Investment Management chief executive Craig Newman says: “We empathise with the predicament faced by financial advisers and, of course, support their desire for choice and control. We have an excellent relationship with Skandia and look forward to working with them in the years ahead.”
Advisers reacted angrily to the original Skandia decision.
Yvonne Goodwin Wealth Management managing director Yvonne Goodwin said: “This move is not giving clients any choice and it is totally against our arrangement with them.
“As a policy we do not invest in funds that do not have a three-year track record, and in this instance, unless we step in, all of our clients on this proposition are being transferred into a brand new fund. We are now reviewing client by client what is the best option for them.”
Thomas and Thomas Financial Services managing director Darren Lloyd Thomas said: “While I can see Skandia may be carrying this out for what it perceives as best client interests, this really is a risky manoeuvre by the firm. I am a Woodford fan myself, but it is very early days to make this call on such an industrial scale.”