The new fees apply to Boal & Co’s standard terms, special terms, and ‘Lite’ offerings across its Isle of Man-based Select schemes and Gibraltar-based Trafalgar schemes.
Annual fees have been reduced by 15% for the majority of cases, while initial fees have been reduced by between 25% and 40%.
Boal & Co chief executive Mark Kiernan confirmed that the decision to lower its fees was not market driven.
He said: “We had some highly valued feedback from our introducers that our fees were slightly more than they should have been. We considered our options, analysed our stats, revenues and profits, and we took the decision to listen to industry feedback and move more in line with some of the other providers out there.”
“The market for Qrops is expanding but fees in general are not being reduced,” said Momentum chief executive Stewart Davies.
“It is more a case of individual providers adapting to the market. The focus of competition among providers is on being able to service advisers and clients in all jurisdictions rather than on charges.
“But it is important that Qrops products do not become commoditised, as there is a need for detailed and expert advice.”
Downward fee pressure
Iain Farr, head of distribution at STM, concurs: “The market has seen some downward fee pressure in the last couple of years; however we suspect that, as respected international finance centres, the regulators in Gibraltar and Malta will become concerned if they believe the fiduciary responsibility of trustees is compromised by the need to provide a low cost service.
“The regulators in both jurisdictions are fiercely protective of their reputations and we believe they will wish to ensure that fees are sufficient to ensure trustees are able to perform their duties to the standards expected, including the HMRC reporting requirements.”
“The market always sets the price,” said Bill Vasilieff, chief executive of Novia Global, confirming that the company has no plans to adjust the pricing of their newly launched Qrops.
“If you’re giving good value for money you can charge a bit more. If you’re not you have to adjust your price. Ultimately, the market will decide.”