Brewin Dolphin, Rathbones and Schroders are the biggest UK independent specialist wealth management firms in terms of income, according to the provisional results of a ranking based on the most recent full-year reporting cycle.
With £304.48 million of income for the year to 30 September 2017 Brewin Dolphin heads the list followed by Rathbones and Schroders (which trades as Cazenove and Benchmark Capital) who reported income of £291.57 million and £273.30 million respectively for the year to 31 December 2017, according to their most recent account filings.
Although Investec Wealth and Investment, has yet to file its results for the year to 31 March 2018 given the data presented by Investec, its parent, and its result for the previous year it is almost certain that the firm will occupy at least fourth position in a more definitive ranking.
For the year to 31 March 2017 Investec Wealth and Investment posted income of £254.80 million. It only has to grow its income by another £18.50 million or by 7.26 percent to match Schroders full-year result.
Based on the preliminary result for the year to 31 December 2018 Tilney occupies fifth position in the ranking based on £226.5 million of reported revenues, a 68 percent increase on the previous year.
Although this is a gross, rather than a net result, as is the case for all the other ranking constituents, Tilney will hold its position once the figures are adjusted to include cost of sales.
Irrespective of the size of this adjustment Tilney will be the fastest growing firm, however, thanks to the impact of a full year’s earnings from Towry, the firm it acquired in 2016.
The next biggest firms in terms of income fall some way behind Tilney.
These are Quilter Cheviot with £162.56 million for the year to 31 December 2017; Charles Stanley with £150.90 million for the year to 31 March 2018; and Smith & Williamson (Investment Management and Banking) with £147.57 million for the year to 30 April 2018.
Canaccord Genuity Wealth is the next firm to exceed a notional £100 million cut-off point with reported revenues of £118.00 million for the year to 31 March 2018.
Like Tilney the firm grew significantly over the previous twelve months as a result of acquisitions.
As usual attempt to compile a ranking based on any metric has to come with caveats.
The first consists of the nature of the firms themselves.
These are either specialist wealth management firms in their right or the specialist wealth management subsidiaries of bigger financial groups.
The list excludes banks, or the wealth management arm of banks, advisory firms such as St James’s Place; or execution only firms like Hargreaves Lansdown.
Any of these firms would almost fall within a wider definition of “wealth management firms”. But the nature of their business is typically fundamentally different from this particular ranking’s constituents, as is the source of their income.
It also excludes firms where a significant volume of business is sourced from institutional rather than private clients.
A second major caveat concerns timing.
The problem here is that there is no consistency as far as reporting periods are concerned. Each firm has its own financial year. And this makes any comparison difficult.
Changes in the ranking could reflect the time of year at which it is compiled.
A third caveat concerns the nature of the accounting policies of the constituents.
Although the data is mainly sourced from the published statutory accounts the underlying accounting policies can vary and this can impact on what is included within "income".
The situation can be complicated further if data is sourced from a preliminary results statement rather than the final published results.
Notwithstanding all these caveats, the ranking reflects an attempt to compare like with like.