Over 50% of private offices not adjusting allocations for a no deal Brexit

Each of Citywire’s conferences, which are held around the world, give us valuable insights into how our delegates are investing, what changes they are anticipating and how their businesses are operating. Last month, we held our annual Private Office Retreat, designed exclusively for the family office and ultra-high-net-worth (UHNW) community. Read on to find out what they said the biggest threats to their businesses was and whether Brexit is concerning them.

As a percentage, how much do you spend on regulation?

A 0-10% 32%
 
 
B 11-20% 41%
 
 
C 21-30% 24%
 
 
D 31-40% 3%
 
 
E 41-50 0%
 
 
 

Regulation was, unsurprisingly, first on the agenda. The majority of delegates are spending 11-20% on regulation, with those spending under 10% coming a close second. One unfortunate person claimed to spend between 31-40% – a figure that, thankfully, didn’t resonate with the rest of the room.

Are you adjusting allocations in preparation for a possible no deal Brexit?

A Yes 47%
 
 
B No 53%
 
 

 

 

Secondly, and again somewhat unsurprisingly, we wanted to find out about Brexit. It was a very close result – 53% of the room claimed they would not be adjusting allocations in preparation of a possible no-deal Brexit. Perhaps comfortingly, that left just under half the room actively making adjustments in anticipation of March 2019.

What business area will you focus/allocate most of your budget to next year?

A Compliance 6%
 
 
B Recruitment 12%
 
 
C Attracting more clients 59%
 
 
D Product development 24%
 
 
E Brexit prep 0%
 
 
 

Attracting more clients is the top thing on our delegates' minds as they look ahead to next year’s budgeting, followed by product development. Interestingly, not one person is focusing on preparing for Brexit, suggesting it’s not as much of a concern as some may say.

What is the biggest threat to your business?

A Stifling regulation 35%
 
 
B Investment management performance 17%
 
 
C Brexit 3%
 
 
D The rise of robo-advisers 3%
 
 
E Key man risk 42%
 
 
F Increased consolidation 0%
 
 
 

Brexit creeps its way into our final question, although just one person selected it as the biggest threat to their business. The overwhelming majority were most concerned about key man risks and the dangers associated with it. Stifling regulation makes an appearance as the next biggest threat to private offices in the coming year.