Aegon UK boss predicts investment platform mergers in post-Covid economy

Aegon UK chief executive Mike Holliday-Williams believes there will be mergers among investment platforms as the pensions industry adjusts to the conditions of the post-Covid economy

Aegon UK chief executive Mike Holliday-Williams believes there will be mergers among investment platforms as the pensions industry adjusts to the challenging conditions of the post-Covid economy.

Holliday-Williams, who succeeded Adrian Grace at the helm of the Edinburgh-based pensions and savings firm in January, said the company’s scale will provide some protection.

Factors like the level of stock markets from which we earn our fees, consumer attitudes to saving, and the ongoing viability of employers who select us as their pension provider will all have an influence on our sector. However, we manage around £180 billion of customer money, which gives us a good deal of scale and means we’re well-placed to cope with the challenges this represents, Holliday-Williams said.

Investment platforms, which help financial advisers and their clients manage their money, could be subject to a shake-up, he said in an interview with Scotland on Sunday.

We believe that this market is over-supplied and in the long run is likely to consolidate. The coronavirus crisis may accelerate this process as smaller players struggle, Holliday-Williams said.

The coronavirus had led to some changes in savings habits. We recently conducted some research to see how people’s savings habits have changed since the start of the coronavirus pandemic – 60% of savers say they’ve altered their monthly savings with around 30% increasing their contributions and 30 per cent decreasing them, he said.

This reflects the different ways in which employment is being affected, with many of those still in work able to save more without travel costs and so on, while the self-employed and those who’ve been furloughed typically reported a reduction in their ability to save, Holliday-Williams said.

One factor the sector has going for it is that auto-enrolment and the pension freedoms have raised the profile of pensions. I think many people recognise the importance of consistency and the benefits of leaving their savings to compound over time. That said, we’re taking nothing for granted and one of our roles is to consistently make the case for long-term saving, he said.