• Overview

     

    We welcome the introduction of “Review of Financial Advice” (RFA) by Jersey Financial Services Commission . The proposed changes are effective from 1st January 2014.

    In order to meet these new regulations, Jersey regulated financial institutions advising Jersey residents will need to:  

    • Agree with the client upfront any applicable charges for the investment advice provided.
    • Clearly define the type of investment advice they provide as being ‘independent’ or explaining the limitations of the advice they can give
    • Ensure their financial advisers adhere to the Jersey Financial Services Commissions codes of practice: hold an appropriate financial services qualification and carry out at least 35 hours continued professional development each year.

     

  •  Why has the Review of Financial Advice (RFA) been introduced?

    The Jersey Financial Services Commission has introduced RFA to increase public confidence in the advice that Jersey resident clients are given on investments and pensions and to increase transparency regarding the cost of advice. The initiative recognises that given current economic challenges, members of the public need more financial help and advice than ever.

     

    Are all Jersey banks and other financial services providers making these changes?

    Yes. It is a requirement for all banks and financial services businesses providing investment advice to Jersey residents.

    How will RFA affect me if I do not reside in Jersey?   

    Advice charging only applies to Jersey residents, however all Lloyds Bank advisers are appropriately qualified.

    Will this affect all of my products with Lloyds Bank International?

    This applies to all investment products (for example funds or discretionary investments) where you are a Jersey resident and you receive investment advice from us.

    RFA does not apply to banking, protection products (Life Insurance, Critical Illness & Income Protection) and general insurance including home insurance.

     

    Why am I now going to be charged for new advice that I receive?

    Fixed fee

    The fixed fee is a standard charge for advice that reflects the cost to the bank for reviewing your specific circumstances and making recommendations that will aim to fulfil your aims and objectives. This will apply if you decide to obtain an advice report.  Your adviser will detail the fixed fee charge during the initial meeting.

     

    Fixed fee / advice charging process

    • If you choose to proceed to the 2nd meeting / production of the investment proposal, you will sign a fixed fee agreement document at the end of the initial meeting
    • If you decide not to take investment advice at the initial meeting no charge is applied.
    • If you decline the investment proposal after the 2nd meeting (or the advice given is that there should be no change) then the fixed fee will be taken. 
    • If the investment is placed the relevant advice charges will apply and the fixed fee will not be applied. 

     

    Investment advice charges

    • The advice charge is set as a percentage of the assets being advised upon.
    • Your adviser will provide a breakdown of the advice charges during the initial meeting so you fully understand what any charges will be, before you decide whether or not you wish to receive the advice