Consolidation of the SIPP market is expected to strongly occur during 2012, according to Suffolk Life who indicates that many companies will simply not have the required assets should the FSA change their capital adequacy requirements to two years.
According to ifamagazine, Chris Jones of Suffolk Life explained:
“A number of providers, particularly those for whom SIPP administration is not a core service, are evaluating their business models and looking at alternative options to de-risk their regulatory exposure. The specialist providers that have the financial strength, robust systems and strong corporate governance infrastructure demanded in today’s market are both best placed and most interested in this sector.
“Market consolidation is therefore the only viable option for many in the SIPP sector as they seek to battle against increased regulatory scrutiny and pressure from advisers.”