December 2007

Welcome to the 12th edition of our Corporate Connection e-bulletin.

We hope that you enjoy these e-bulletins. If you have any queries, or would like to discuss any of the issues raised with one of our consultants, please call us on 0845 050 0112 and quote EM-4488.

Towry Law continues UK growth

We have made no secret of our desire to be the premier provider of private and corporate wealth advice in the UK. We have, therefore, been pleased to announce two further steps toward achieving that goal.

Scotland

Towry Law has announced the acquisition of McGowans, a financial advisory firm based in St Andrews, Scotland.

McGowans is run by brothers John and Barry McGowan, has over 1,000 clients and £60 million of assets under advice. The acquisition continues the expansion of Towry Law in Scotland, where it is already the largest wealth advisory firm with over 35 Wealth Advisers operating from offices in Glasgow, Edinburgh and Aberdeen.

John McGowan has been appointed as a Senior Client Partner of Towry Law, one of only eight such positions across the company, and Barry McGowan has joined as a Wealth Adviser.

John McGowan, said:

"We are delighted to be joining Towry Law at such an exciting time in the Company's history. Our industry is undergoing considerable change and we considered that it was the right time and in the best interests of our clients to merge into Towry Law, a firm that has both the talent and capital to deliver an outstanding proposition to our clients.

We are looking forward to increasing the range of services we are able to offer to our clients and building further on the hard work we have put in over the last 15 years. We also look forward to making Towry Law become recognised as the premier provider of private and corporate wealth advice in Scotland."

Manchester

Towry Law has announced the opening of its new premises in central Manchester.
The new 4,000 sq ft office, in Wellington House, Piccadilly, is four times larger than Towry Law's previous Manchester base and demonstrates the commitment we have to expand in the region. The office will initially have 29 Wealth Advisers and support staff, though this number is likely to increase significantly during 2008, as Towry Law continues to expand its Manchester operations.

I am extremely excited about the expansion of Towry Law in Manchester. We have had a presence in the city for many years, and now with the rapid growth of Towry Law across the UK, are in position to increase significantly our commitment to Manchester and the North West.

We believe that a fee-based wealth advice service is the only way individual and corporate clients can ensure they are receiving truly independent advice, and we look forward to continuing to build relationships with clients and their legal and accounting advisers in and around Manchester in order to provide this.

These new premises will provide a high quality environment for both our clients and professional contacts and demonstrate our commitment to growing our business in Manchester and the North-West.

Andy Cowan
Head of Private Client

Towry Law in the media

Towry Law is receiving a significant amount of media coverage within the private and corporate wealth advice arenas.

Please click here for the article that was featured in New Model Adviser which provides a profile of Andrew Fisher, Chief Executive of Towry Law.

The article covers Andrew's career, including his time as Chief Executive of Coutts, an insight into Towry Law including the changes that have taken place and the firm's plans for the future.

 

 

Patrick Connolly
Marketing and PR Manager

Towry Law sponsors the Large Firm of the Year award at the Accountancy Age Awards for Excellence

Towry Law was pleased to sponsor the Large Firm of the Year award at the Accountancy Age Awards for Excellence.

The event took place at Battersea Park Arena in London on the 14th November and was attended by 1,300 guests.

Towry Law took a table at the dinner and invited some of our colleagues from the accountancy profession to join us. The Towry Law award was won by Smith & Williamson and was presented by Andrew Fisher, Chief Executive of Towry Law. A photo is attached.

We are very pleased to support excellence in professional services. We have built and enhanced strong relationships with the pre-eminent members of the accountancy, and the legal, communities during 2007 and will continue to work alongside these professional services firms during 2008, in the best interests of our respective clients.

Market commentary

Overview

It has been an extraordinarily difficult period to time markets as volatility in both equities and fixed interest has risen sharply and many of our peers have been caught out by reducing equity weightings only to see them rebound sharply.

The main drivers for equity returns continue to be Asia and Emerging Markets although Europe has surprised many people too, rising 15% over the past year. Some of the froth has come off the Chinese market but returns there are still over 100% with Brazil (+80%) and India (+61%) trailing in its wake. The UK and US have been positively staid by comparison rising 6.3% and 4.7% respectively. All these numbers are sterling adjusted. 

Government bonds have performed well despite a sell off into the summer but the flight to quality from the sub prime debacle has driven yields down and prices up again. Conventional gilts are up 2.3%, Index Linked +4.8% and Global Bonds (Sovereign debt) +4.7%. By avoiding the high yield bond sector we have not been exposed to the sub prime fall out although sentiment in the credit markets has meant that investment grade UK Corporate bond holdings are marginally in negative territory but with plenty of scope to bounce back from here.

Commercial property is going through a slowdown and rental yields are now back above gilt returns again which is very supportive for the market. 'Bricks and mortar' property holdings are showing small single digit losses for the last twelve months but compare this to a 29% loss for the FTSE Real Estate property share index. That index peaked in January and has subsequently fallen 35%.

Outlook

There is much to concern financial markets at present from the unwinding of sub prime debt positions to the strength of the global economy as a whole. The sub prime debt issue is mainly for the US investment banks and the Federal Reserve to sort out, not unlike the Savings and Loans crisis in the 90s. There will be fall out amongst some of the smaller institutions when they discover, or own up to holding, pretty much worthless paper and the steady drip of bad news will keep market volatility relatively high.

The US is still the most significant driver of the world economy but its influence is slowly waning. The GDP share of the emerging economies, particularly China, Russia, India and Brazil is rapidly on the increase. The US housing market is in a parlous state but even here the pattern is not the same across the whole of the country. There will be some slow down in the economy as a result but the Federal Reserve has already started cutting interest rates and the Bank of England is likely to follow suit in the near future.

As ever, multi asset class portfolios should perform in a steadier, and incrementally more accumulative manner than others, with less relative risk, and via regular rebalancing will successfully tackle most investment environments.

Andrew Wilson

Head of Investment Management

This Global Markets Commentary is solely for information purposes and is not intended to be, and should not be construed as investment advice.

Whilst considerable care has been taken to ensure the information contained within this commentary is accurate and up-to-date, no warranty is given as to the accuracy or completeness of any information and no liability is accepted for any errors or omissions in such information or any action taken on the basis of this information.

The opinions expressed are those of Towry Law Investment Management Limited on behalf of Towry Law Financial Services Limited and are made in good faith, but are subject to change without notice.

Is your business adequately protected?

Key Person Assurance

Many employers are keen to provide competitive remuneration packages to help with Staff recruitment and retention of valuable employees.

However, many do not regularly assess the potential upset or loss which their business would suffer in the event of the death or prolonged illness of one or more of their Key Employees. Obviously, all employees play a role in an employer's business, but some are of particular importance in maintaining the commercial viability of the organisation.

The potential risks to the business can typically include:

• The possible cost of finding and training a replacement and the effect on future performance or profitability.
• Potential loss of goodwill from customers or suppliers
• Cover for a business loan as may be required by the lender
• Purchase of a shareholding in accordance with the company's Articles of Association

The employer can effect an insurance policy on the life of the key person to cover the possibility of the employee dying or becoming seriously ill. The proceeds will then be used to protect the business against a downturn in profits, to fund a temporary replacement until a successor can be found or trained, or help repay an outstanding loan.

Estimating the loss to the business can not be an exact science as circumstances are likely to change, and because each situation is likely to be unique, we can provide assistance with the method of estimating the potential loss on the death or illness of a Key individual. We can also assist with the regular monitoring of this potential loss as circumstances change.

Taxation

Whether any tax will be payable, at what level it is charged and whether the business qualifies for tax relief on the premium will depend on individual circumstances and may be subject to change in the future. In any event employers should write to their local Inspector of Taxes at outset, stating their view of the tax treatment of both the premiums and proceeds and ask the local inspector to confirm or deny such a view.

Employers should ensure that their business is not at risk and keep such policies under regular review. We often come across businesses that have not reviewed their key person policies and have found that the cover being provided is either inadequate for purpose or excessive to the requirement.

Employers should address this issue and continue to monitor the effects to their business to protect their future continuity.

Howard Finch
Practice Manager

IMPORTANT NOTICE: Towry Law Financial Services Limited. Registered in England No. 607039. Towry Law Investment Management Limited. Registered in England No.793636. Towry Law Trustee Company Limited. Registered in England No. 1151146. Towry Law Pension Trustees Limited. Registered in England No.781047. All of the above firms are authorised and regulated by the Financial Services Authority. Towry Law Holdings Limited. Registered in England No.4773122. Towry Law Nominees Limited. Registered in England No.2988101. Towry Law Services Limited. Registered in England No. 5169111. The Registered Office of all these companies is Towry Law House, Western Road, Bracknell, Berkshire, RG12 1TL. Telephone 01344 828000.

We may record telephone calls to protect both of us and for training purposes. We may also monitor the content of email communications and by sending an email to us or responding to an email from us you acknowledge and accept that any such email communications may be monitored. The information contained in this e-mail is intended only for the individual or entity to whom it is addressed. It may contain privileged and confidential information and if you are not an intended recipient you must not print, copy, distribute or take any action in reliance on it. If you have received this e-mail in error, please notify the sender by using the reply function, and then delete the message from your computer. Although this message and any attachments are believed to be free of any virus or other defect that might affect your computer system into which it is received and opened, it is the responsibility of the recipient to ensure that it is virus free, and no responsibility is accepted by Towry Law for any loss or damage in any way arising from its use.