Mortgage News
Personal Touch profits rise; incurs additional £154k in claims costs
Restricted network Personal Touch Financial Services has set aside an additional £154,000 to cover excess payments in relation to claims brought against the firm in 2013, its accounts show.
The extra £154,000 has been added to the previous balance of £630,000, leaving a total amount of £677,000 the firm believes it will face in specific claims already brought in relation to mortgages, protection and investments & pensions.
The company’s pre-tax profits increased from £399,000 in 2012 to £483,000 in the year despite a dramatic fall in adviser numbers and turnover.
The network’s results showed a total of 247 firms – or 488 registered individuals – left the previous pool of 576 firms in the period; some, so-called “managed leavers”, were asked to leave as part of a de-risking process.
Personal Touch’s turnover decreased by 21.4% as a result, to £51m.
However, the company’s gross profit margin increased from 17% in 2012 to 20% in 2013 due to an increase in membership fees – also part of its new strategy, Personal Touch said.
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Chief executive Max Wright (pictured) said regulatory demands had made it necessary to “get rid of the dabblers.”
Personal Touch last month announced the launch of a business development programme for its member firms to help them grow and manage their businesses.
It said last November it will subsidise member firms’ regulatory fees for 2014 using money generated from “stronger mortgage volumes and other cost and efficiency savings” to “reward loyalty”. This followed a freeze of its own network member fees in September.