AFM Comments on the report of the APPG for Mutuals’ on its Inquiry into the proposed sale of LV=

“As a trade body supporting the mutual sector, the Association of Financial Mutuals is very grateful for the attention paid by the All-Party Parliamentary Group for Mutuals to the planned demutualisation of LV=.

The decision to demutualise is a one-time, irreversible one, and cannot be taken lightly.   The management of LV= has decided the business will be in a better position competitively under the protection of a private equity owner, Bain Capital.  However, it has yet to put the case to its members, who will ultimately decide on whether the deal goes ahead.
Over the last 30 years, demutualisations have seldom resulted in a happy outcome: customers generally get a worse deal as their interests become secondary to those of shareholders; management’s expectations of more capital, as well as greater independence in which to spend it, have tended to result more often in failed business plans and an early takeover.
The mutual sector continues to serve tens of millions of UK customers, and is as relevant and vital today as it has always been.  As consumers demand that financial services businesses manage their money more responsibly, and pay greater attention to the needs of society, the attraction of customer ownership is becoming ever more apparent.
We agree entirely with the APPG inquiry recommendations, that there is greater scrutiny of the proposed sale by parliament and by regulators, and that more attention is given to updating legislation, to enable the mutual sector to compete on equal terms.”

In a recent article for FT Adviser, AFM’s CEO comments on the demise of a stalwart of member-ownership. Read more

Research from Association of Financial Mutuals (AFM) shows paid claims volume increased 38% compared to last year. Read more here

The latest news from Association of Financial Mutuals

In an article published in the i on 11 January 2021, AFM CEO provides expert advice on businesses owned by customers: Read here

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Child Trust Funds: five tips on what to do with the money

Most of the around 55,000 young people turning 18 in September will enjoy an unexpected and worthwhile birthday present: the Child Trust Fund (CTF). This scheme was launched by the government in 2005 and the first funds will be available to spend or re-invest this year.

The average CTF will be worth over £1,000, but many accounts will hold significantly more than that. And while the temptation might be to spend the money on a car, a holiday or to pay off bills, recent research from OneFamily, the largest provider of CTFs, shows that most young adults are inclined to invest the money to build up a future nest egg.

Young people are also likely to look for help on what to do with the money from their parents, grandparents or guardian, so here are five tips on guiding them to make the right decision.

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