The number of providers in the SIPP sector has fallen to its lowest level in nearly a decade due to a wave of mergers and takeovers, according to new data.

Both provider and product numbers are at their lowest levels since 2012, data produced for the latest issue of Financial Planning Today magazine, out Thursday, reveals.

Since the start of 2020 there has been a marked fall in the number of SIPP products and providers, despite there being a steady growth in numbers prior to 2020.

According to Defaqto, on 1 April 2020 there were 79 providers with 129 SIPP products, a small but significant fall from the previous year which saw 136 SIPPs from 84 providers.

In 2021 on the same date, numbers had shrunk further to 122 SIPPs from 74 providers, the lowest number of providers since 2012.

The decline is likely partially down to rapid merger and acquisition activity that has taken place since 2019. Hornbuckle was closed and Liberty SIPP rebranded following their takeovers by Embark. GPC SIPP also closed following sale to Hartley Pensions. Talbot and Muir acquired The Pensions Partnership which led to the latter’s product closing. They were then purchased by Curtis Banks.

Suffolk Life also remained under its own brand after it was bought in 2016 by Curtis Banks. However, the closure of both theirs and Curtis Bank’s legacy SIPP saw a new product called Your FutureSIPP launch under the Curtis Banks name.

Also in 2019, Astute Trustees closed following a sale to YorSIPP; MC Trustees shut following a sale to Mattioli Woods and Wensley, which was originally sold to Praemium in 2016, closed its product.

Alliance Trust, EBS Pensions and Rowanmoor all closed to new business following their sale to Embark during 2020. The Zurich Intermediary platform that went to Embark undertook some feature changes and is now Advance by Embark.

Other rebrands have included Carey Pensions to Options Pensions, Momentum Pensions to iPension and Xafinity to XPS Self Invested Pensions.

The decline in providers in the SIPPs market may also be partly driven by uncertainty around the pivotal ‘Adams’ SIPP case. The case involves the question of provider responsibility when accepting investments into a SIPP. A recent court appeal case found mostly agains the provider, Carey Pensions, in a move which has rattled many.

This morning STM Group, the international financial services provider which owns Carey Pensions, reported a 48% drop in profit before taxation for the year ended 31 December. 

You can read the full SIPP Report looking in detail at the state of play in the SIPP market in the latest issue of Financial Planning Today magazine.

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