Regulatory Update

Rathbones Group Plc ('Rathbones' or the 'Group') announces that it has undertaken a Skilled Person Review following engagement with the Financial Conduct Authority ('FCA'). The review has identified areas for improvement within the Group's UK Wealth Management business regarding the implementation and embedding of Consumer Duty, as well as certain aspects of its compliance, oversight and assurance arrangements.

The Group is undertaking the following actions:

• A programme of work addressing the recommendations from the review, which is expected to be conducted over a two-year period.
• A targeted review of a portion of our clients to assess whether they have received good outcomes.
• For a period of up to twelve months, a voluntary pause to the onboarding of new clients that require Enhanced Due Diligence ('EDD clients') whilst the Group focuses on implementing changes to its procedures and controls. In the last twelve months, relevant gross inflows from EDD clients totalled approximately £370 million.
• A voluntary pause to the acceptance of inflows into general investment accounts from some existing EDD clients. The Group will work with these clients to meet certain requirements such that they are able to resume inflows as soon as practicable. This affects approximately 4,700, or 4%, of the Group's 119,000 clients, and in the last twelve months, relevant gross inflows from these clients totalled approximately £530 million.

Related to these actions, the Group expects to incur estimated costs of £60 million, net of expected insurance recoveries, which will be recognised as non-underlying expenses over the next two years. The Group's dividend policy remains unchanged, and the previously announced £20 million share buyback programme, which has now been approved by the PRA, will commence shortly.

In addition, the Group is reviewing certain aspects of its pricing as part of its ongoing commitment to delivering fair value for clients. In the interim, the Group intends to cease charging investment management fees on cash balances held within clients' discretionary portfolios from 1 July. This is expected to impact underlying profit before tax by approximately £9 million for 2026.

Jonathan Sorrell, Chief Executive Officer, said:

"We are committed to operating to the highest standards on behalf of our clients. The work we are undertaking will support and accelerate our vision to be the best wealth manager in the UK, by far. Our strategy is unchanged and we continue to make strong progress against the plan set out in February. I am grateful for the constructive engagement with the FCA, and the continued trust of our clients as we implement these improvements."

A FTSE 250 company (LSE:RAT), Rathbones has over 3,300 employees, including over 700 investment managers and financial planners, in 21 offices across the UK and the Channel Islands, providing its clients with high-quality, personalised wealth management services.