Analysts warn dealing commission rules 'worse than RDR' for groups

Regulation

The unbundling of dealing commissions could have a more significant impact than the Retail Distribution Review on asset managers, with smaller groups and fund ranges particularly at risk, analysts have warned.

A note from Berenberg issued this month said the proposals could result in increased M&A activity, a scaling back of fund ranges, and a 20%-30% hit to industry profitability. The European Securities and Markets Authority (ESMA) has been consulting over the proposals this summer, the UK's Financial Conduct Authority having earlier backed MiFID plans to ban paying for research notes using dealing commission. But with ESMA due to submit recommendations to the European Commission in December, the impact is beginning to make itself felt in asset manager share prices, despite the fact any c...