Why are banks so crap at running pensions?

I may sound a little harsh about our banks but they really are rubbish at pensions.

Infact they’re pretty crap all round as Gordon Aitken points out.

Gordon has commented that banks have outperformed life insurers for some time but in budget week the banks plummeted while insurers did very nicely (see above) and my recent blog.

I know the more important role of life insurers is to dismantle UK pension schemes but what about banks? What have UK banks been doing with pensions over the past ten years?

NatWest has purchased Cushon and then sold them on to WTW when they couldn’t make it a platform to sell their retail products. The same story goes for HSBC who tried to build heir own master trust only to jack it in before it sold a bean. Barclays have threatened to sell personal pensions but have failed to do so while Lloyds are the only bank to still have a workplace pension in Scottish Widows.

Apart from L&G no insurer has made “scale” yet but it’s the ones that haven’t been flirting with banks that have done best and the workplace pensions that have made it three times over (Nest , Lifesightand People’s Pension)

Scottish Widows are clinging on to “scale” because of their legacy personal pension books but have a conspicuously history in workplace pensions with a master trust that is relying on for growth on consolidating the Lloyds staff DC scheme, (Your Tomorrow).

I’ve no idea why banks can’t do pensions but the evidence is clear to see. Maybe that’s one reason why UK life insurers are doing rather better than UK banks.

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About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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