Rathbones Group
RAT · Main Market · Financial Services · mcap £1,640m · 1712.0p 2 open situations →
Open · 2
FCA Consumer Duty remediation
A Skilled Person Review found Consumer Duty gaps in UK Wealth Management, leading to a two-year remediation programme from 16 June. The interims report £19.0m of H1 costs and a c.£9m H2 income hit from ending fees on cash. On 30 July the Board named Michelle Scrimgeour, a former LGIM chief executive and former M&G chief risk officer, as an independent NED from 1 October, intended to succeed Terri Duhon as Risk Committee Chair.
- H1 cost
- £19.0 million recognised, non-underlying (HY 2025: £nil)
- H2 income hit
- Ending fees on cash cuts income and operating profit by c.£9m
- Management view
- Good initial progress; client reaction supportive and resilient
- Earlier estimate
- £60m net costs over two years, per the 16 June announcement
- Risk Committee chair
- Michelle Scrimgeour intended to succeed Terri Duhon, subject to regulatory approval
- Start date
- 1 October 2026, subject to regulatory approval
- 30 Jul 2026 Remediation under way; Risk Committee chair succession set
- 29 Jul 2026 Remediation under way; costs rising
- 16 Jun 2026 Skilled Person Review done; two-year programme starting
- 16 Jun 2026 Skilled Person Review done; two-year programme starting
Growth strategy and 30% margin target
Strategy was unchanged in February, with a 30% underlying operating margin target by Q4 2026. FCA actions on 16 June brought new headwinds. The interims cut the Q4 target to 28.7% because ending fees on cash lowers H2 margin by 1.3 points. Management says it is on track for the revised target.
- Revised target
- Q4 2026 underlying operating margin 28.7%, from 30.0%
- Cause
- Ending fees on cash cuts H2 margin by 1.3 percentage points
- H1 margin
- 25.3% (HY 2025: 24.0%)
- Support
- Salesforce implementation due by end of Q3 and ongoing cost efficiencies
- Dividend
- Interim 32.0p, up 3.2%; progressive policy unchanged
Next: Deliver revised 28.7% Q4 2026 margin target
- 29 Jul 2026 Q4 margin target cut to 28.7%
- 16 Jun 2026 Strategy unchanged; new headwinds from FCA actions
- 16 Jun 2026 Strategy unchanged but new headwinds from FCA actions
- 7 May 2026 Execution continuing; flows stabilising in wealth
Closed · 3
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