“ What Role Will Platforms Play in the Post-RDR World?” – February 2012 Emma Napier, Head of Adviser Relations, The Platforum

So, what’s going on?!

UK Platforms – Q £168bn as of September 2011* 2.4% increase in AUA from Q to Q (against FTSE fall of 14.4%) We did anticipate platform AUA would increase to at least £320bn by 31 Dec 2012 – current growth challenges this assumption  The Platforum *includes new entrant AJ Bell reporting £11.1bn AUA

Table of IFA Platforms by Size Platform nameDate of LaunchAUA £bn (30 Sep 2011)% Change +/- SkandiaJul % CofundsJan % FundsNetworkJan % TransactOct % Standard LifeMay % SEIApril % Seven IMSept % AscentricAug % Alliance TrustJun % ElevateNov % NucleusDec % Raymond JamesJan % 5

Current IFA Platform Providers 25 platforms today With 4+ more confirmed future entrants

It’s not just adviser platforms on the rise..

A profile of the average D2C customer Total market AUA = £64.9bn as at September 2010 Estimated 2.5 million active D2C customers in the UK today 1 million IFA + fund manager accounts Hargreaves Lansdown 337,000 customers = 28.5% market share According to Compeer, as at 2009 there were 1.9 million XO nominee accounts with stockbrokers Up to 4 million client accounts with execution-only stockbrokers today Average account size across all D2C platforms is £25,288 Average age of D2C customer is 57

CP10/29 No payments from product providers to advisers No more cash rebates Proposed unit rebates Increased disclosure and transparency An independent adviser will need to be able to chose from all investment types.... But will the term independent retain currency moving forward?

And Suitability Thematic Review (DP 10/2) RMAR Platform due diligence Can I use just one platform and still be independent? How often should we do due diligence? How can I compare charges?

What’s bothering IFAs today? The RDR – first country to try and move advisers to fees in a bull market Increased qualifications Increased regulation Use of risk profilers and portfolio modelling tools Platform selection and due diligence Client segmentation Lack of clarity VAT.....very busy and pushed for time

Q1 Q2 Q3

Most advisers are using 3 platforms today

Happy advisers use one platform Adviser using one platform BDM Support55% Customer Service80% Ease of Doing Business82% General Web Usability78% Value for fees charged82% General opinion73% Adviser using three or more platforms 36% 39% 49% 45% 44% 45%

What’s bothering IFAs?

The regulator and the RDR - Platform selection – can I use just one? - Platform due diligence - Banning commission and moving to fees - Using portfolio tools/client suitability VAT Independence Pretty much everything….!

Our Leaderboard and evaluation

The Platforum Leaderboard for Q3 2011

How we calculate The Platforum Leaderboard

PAT – Platform Analysis Tool

The Future?

FSA IFAs Corporate D2C Back office Funds Platforms Adviser charging Providers Platforms (bundled and unbundled) Clean share price Tiered charging Transparency Rebates Reregistration

Thanks and any questions? Emma Napier Head of Adviser Relations, The