The entire market (all 300+ participants and four vendors) successfully upgraded to a new version of the TeX/UKFMPG open transfer standards in November, the number of counterparties supporting electronic transfers increased significantly, and the FCA published its ‘Making transfers simpler’ Policy Statement (PS 19/29) in December.
At the end of 2019 there were 363 counterparties across the Pensions, Savings and Investment industry supporting TeX electronic open standards transfers and asset re-registrations. That’s 43 new counterparties added in the latter half of 2019.
The Market Coverage
Pretty much all the Advisor Platforms and Fund Managers (at least those focused on retail distribution) are now supporting electronic transfers, while the support among Wealth Managers continues to grow steadily.
Here is a summary of the coverage in the main market sectors:
25 Adviser Platforms, representing 99.5% of AUA, support electronic transfers.
- All the top 20 Adviser Platforms support electronic transfers.
- 14 Adviser Platforms (or 58% of AUA) use the Altus Transfer Gateway (ATG).
35 D2C Platforms and Execution Only Brokers support electronic transfers.
- 9 of the top 10 D2C providers support electronic Transfers.
- 30 use the Altus Transfer Gateway (ATG).
77 Wealth Managers and Private Clients support electronic transfers.
- 73 use the Altus Transfer Gateway (ATG).
40 White Label/Family Office/Charities.
- 38 use the Altus Transfer Gateway (ATG).
7 Custodians/Intermediate Unit Holders support electronic re-registration.
- 6 use the Altus Transfer Gateway (ATG).
164 Fund Managers support electronic re-registration.
- Represent 85% of UK Retail Funds
- 40 (or 54% of FUM) use the Altus Transfer Gateway (ATG)
The Open Transfer Standard Upgrade went live
Over the weekend of 23rd/24th November 2019 all participants upgraded to V3.2 of the TeX/UKFMPG open transfer standards. On Monday 25th November over 97% of transfers and re-registrations completed successfully, so well done to all participants, vendors and TeX/UKFMPG for such a magnificent effort. Now the entire market is on one version of the open transfer standards with much more capability, and we’re seeing an overall increase in the volume of transfers as well as some new milestones reached, such as the first open standards in-specie Pension transfers between vendors.
The FCA – Share Class Conversions
On Friday 13th December 2019, not ominous at all, in response to its Consultation on Investment Platform the FCA released its Policy Statement PS 19/29 entitled ‘Making Transfer Simpler’. This Policy Statement mandates that ceding parties must allow conversions where necessary as part of an in-specie transfer and acquiring parties must allow investors to convert to the best available share class from the end of July 2020. Not a lot of time to get everything in place; fortunately, we have an ‘oven ready’ solution. The latest release of the Altus Transfer Gateway (ATG) offers full support for electronic conversions, both pre and post asset re-registration, and it includes all the electronic message support from custodians to fund managers, in other words the entire supply chain. For more information please see our Briefing Note.
We are running a workshop on the practicalities of automating the share class conversion process on 3rd of March.