Schroders has collaborated with Lloyds Banking Group to create a financial planning joint venture (JV) firm for affluent customers.
Image: Schroders and Lloyds have collaborated to establish financial planning JV firm. Photo: courtesy of Schroders plc.
Under the deal, Lloyds will own 50.1% stake in the new JV, while the remaining 49.9% stake will be owned by Schroders.
The partnership will aggregate Schroders’ investment and wealth management expertise and technology capabilities with Lloyds’ client base, multi-channel distribution and digital capabilities.
Lloyds Group chief executive António Horta-Osório said: “I am delighted to be announcing this exciting partnership with Schroders and the creation of a new market leading wealth management proposition. This provides a strong platform for growth and is a further step in the delivery of our strategic objectives.”
By using world-class investment expertise and advanced technology, the JV will work to fulfill the growing gap in the advice market through a personalized and advice-led proposition.
As per terms of the deal, Lloyds will shift around £13bn of assets and associated advisers from its existing Wealth Management business to the JV.
Expected to start operations by the end of first half of 2019, the JV will be headed by a management team, comprising of representatives from both partners.
When operational, Scottish Widows chief executive Antonio Lorenzo and insurance and wealth group director Antonio Lorenzo will be the chairman, and Schroders UK Intermediary co-head James Rainbow will serve as chief executive for new JV.
Lloyds will secure up to a 19.9% financial investment in the holding company of Schroders’ UK wealth management business, in connection with the transfer of the £13bn of assets to the JV.
It will offer Lloyds’ high net worth customers with access to Cazenove Capital’s major wealth management propositions.
The collaboration will allow Lloyds to provide specialist investment management services of Cazenove Capital to charities and family offices.
In addition, Lloyds will transfer around £400m of existing private client assets under management to Schroders’ UK wealth management business.
Schroders Group chief executive Peter Harrison said: “Wealth management is a strategic priority for Schroders. In combining our award-winning technology and world-class investment expertise with Lloyds’ significant client base and digital capabilities, we are creating a strategic partnership which is exclusively focused on the evolving needs of UK savers and investors.”