Legal notices for our financial services

We follow strict legal regulations, to provide you with the best service and protection.

Regulatory Information

Tees and Tees Financial are trading names of Tees Financial Limited.

Tees Financial Ltd is authorised and regulated by the Financial Conduct Authority to conduct investment, pension, protection and equity release business. Tees Financial Ltd appears on the Financial Services Register under number 211314. Tees Financial Ltd is registered in England and Wales with number 4342506 and with VAT number 801 4348 64.

Tees Financial Ltd is a wholly owned subsidiary of Trust Tees Ltd which is registered in England and Wales under number 07497167. The Registered Office of both Tees Financial Ltd and Trust Tees Ltd is Tees House, 95 London Road, Bishop’s Stortford, Hertfordshire CM23 3GW.

Terms of Use

The material on this website has been prepared to provide useful information but does not constitute financial or other professional advice and should not be considered as a substitute for financial or other professional advice on any specific case. Nothing on this site constitutes an advertisement or a binding offer to perform any financial service in any jurisdiction.

Tees Financial Ltd and its directors and employees will endeavour to keep the content of this website accurate and up-to-date but do not accept any liability for any loss caused in connection with use or reliance on the contents of this website except as prohibited by law.

We are not responsible for the content of any other website, including any website through which you may have gained access to our website or to which you may gain access from our website. We do not accept any liability in connection with any such websites or links.

Copyright and Intellectual Property

The copyright and other intellectual property rights in the contents of this website, including any Tees, Tees Financial Ltd and/or Stanley Tee LLP marks, logos and brands, belong to Tees Financial Ltd and/or Stanley Tee LLP (or any licensors who have expressly licensed content to Tees Financial Ltd and/or Stanley Tee LLP). All rights, save as expressly granted, are reserved except that:

You are permitted to print or download extracts from this website for your own personal use provided the material is not incorporated in any other work or publication;

You may copy extracts from this website to provide to individual third parties for their own personal use provided you inform the individual that Tees Financial Ltd and/or Stanley Tee LLP is the source of the material and that its use is subject to the terms set out on this website.

Links to this website may not be included on any other website without our prior written permission. If you are in doubt whether an item is copyright or a trade mark of Tees, Tees Financial Ltd and/or Stanley Tee LLP please contact us for clarification.

Client Agreement

We provide our clients with our Client Agreement at the start of each new matter, but you can also view our Client Agreement by clicking here. You can view our Discretionary Management Agreement by clicking here.

Complaints

We are committed to providing a high quality service to all our clients but we recognise that occasionally problems and concerns do arise.

Dealing promptly and effectively with your concerns is an important aspect of our approach to client care. If you are dissatisfied with the service we have provided to you as a client we hope you will raise your concerns with us so that we can try to resolve the issue(s). The procedure we follow to investigate and try to resolve a client’s concerns can be viewed by clicking here.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services businesses aren't able to resolve themselves. To contact the Financial Ombudsman Service please visit www.financial-ombudsman.org.uk.

Governing Law

Our website relates only to the laws of England and Wales except as expressly stated to the contrary.

In the event of any dispute arising as a result of content posted on this website, the jurisdiction and applicable law to be invoked is that of England and Wales.

To find out more, talk to us now on 01279 658304

Pillar 3 Disclosure

SECTION

CONTENTS 

  1. Background
  2. Overview of Firm
  3. Frequency of Disclosure
  4. Management of Risk 
  5. Capital Resources
  6. Remuneration 

 

1. Background 

Having adequate capital resources is a key threshold condition and firms with Investment Management permissions are subject to higher capital resource requirements and more stringent rules surrounding the monitoring of this.  This is because this type of firm will fall within the scope of MiFID and under the full scope of the Capital Requirements Directive (CRD) which fully came into force on 1 January 2008. 

The CRD approach is based around 3 ‘Pillars’ i.e. ‘Pillar 1’ / ‘Pillar 2’ and ‘Pillar 3’.  These 3 Pillars collectively form the framework for the prudential supervision of banks, credit institutions and certain investment firms – including BIPRU firms.   The CRD specifies the amount and nature of capital, credit institutions and investment firms must hold.  

Pillar 1 revises existing minimum regulatory capital standards for three major ‘risks’ that firms face i.e. credit, market and operational risk.

Pillar 2 requires firms to assess the amount of internal capital they consider will cover all of the risks they are, or likely to be, exposed to.

Pillar 3 requires firms to publish key information about their underlying risks, models, controls and capital position, to the market forces brought to bear in these areas.

2. Overview of Firm

The firm is authorised and regulated by the Financial Conduct Authority (FCA) and falls into the category of a ‘Tier 4’ firm. It is likely that the category will reduce when the firm no longer holds client money as will arise within the following financial year.

It is an Investment Management firm, which comes under the prudential category for Banks, Building Societies and Investments firms (BIPRU) in the FCA Handbook.

It is currently a BIPRU €125k firm and therefore has permission to hold client money and assets for investment business but does not have permission to deal for own account.

Tees Financial has two elements; Financial Planning which consists of providing advice regarding investment, protection, retirement and inheritance tax planning and Investment Advisory which provides portfolio management.

3. Frequency of Disclosure

The Firm will make its annual Pillar 3 disclosures on our website ( www.teeslaw.com ) after approval of the year end financial statements and review of its ICAAP.

Except in relation to disclosures under Remuneration, we may omit information which we consider to be regarded as proprietary or confidential. 

4. Management of Risk 

The senior management have designed and implemented a strategy to mitigate the risks that the firm faces through the application of appropriate systems and controls. 

The firm has identified the material risks to which it could be exposed and these have been assessed and quantified in the Firm’s ICAAP.

5. Capital Resources 

Pillar 1 – Minimum capital resource requirement 

Its minimum capital resource requirement is the higher of:

  • The base capital resource of  €125k or
  • The sum of total it’s ‘credit risk’, ‘market risk’ and ‘operational risk’ requirements or 
  • Its fixed overhead requirement (FOR).

 

Credit risk

‘The risk of loss due to a debtor’s non payment of monies owed at a stipulated time’.

This risk is analysed and considered as part of ICAAP and is not considered applicable.

Market risk

‘The risk of losses in on and off balance sheet positions arising from movement in market prices (BIPRU 7)’.

The board has considered this risk as part of ICAAP. In the event of a 20% to 25% downturn in world markets, income would fall to approximately £1,500,000. The board regards this a realistic assessment in the light of the exit of the UK from the EEC. The firm would be able to continue trading if this were to occur.

Operational risk

‘The risks of poor investment performance of funds under management, legal and reputational risks’.

Investment performance is covered in the section above and there is an established disaster recovery/ business continuity plan in place.

It is considered that there are adequate staff to deal with the loss of experienced personnel both with the Financial Planning and Investment Advisory Teams.

Fixed Overheads Requirement (FOR)

The FOR is an amount equal to one quarter of the firm’s relevant fixed expenditure.

The FOR as set out in our annual return to the FCA is £256,252.

Pillar 2

A firm must, amongst other things, assess regularly the amount of internal capital it considers adequate to cover all of the risks to which it is exposed within the context of its overall risk management framework. The process is known as the Internal Capital Adequacy Assessment Process (ICAAP).

The firm has considered and assessed the following areas of potential risks to its business and summarises its approach to each one:

Liquidity risk

‘The risks of a firm not maintaining sufficient liquid resources to cover any potential imbalances and fluctuations in fees receivable and expenditure which is unknown and unplanned’. 

There are adequate cash balances and in the event of a sustained and prolonged downturn, actions would be taken to reduce the cost base.

Securitization risk 

‘The effect on a firm’s financial position of a securitisation arrangement failing or of the values and risks transferred not emerging as expected’.

The board has considered this as part of its ICAAP analysis and has concluded that it does not constitute a risk.

Interest rate risk

‘The effect on a firm’s financial position as a result of interest rate changes and the effect of this on the balance sheet’.

The firm has no direct borrowings and would not be vulnerable to any interest rate rise even if such is considered unlikely in the current economic environment. Inter company liabilities carry no interest obligation.

Concentration risk

‘The effect of a firm having a large exposure to sectoral, geographical, liability and asset concentrations or to a particular client’.

Portfolios are diversified as per Wealth Managers Association guidelines and there is no single dominant client.

Insurance risk

‘The effect of having inadequate insurance cover to cover a claim or the effect on a firm’s cash flow after payment of an excess on the policy’.

The firm has insurance cover of £1.75 million per claim and the excess payment of £5,000 is well within our ability to meet it should a claim arise.

Summary

The firm’s Pillar 1 capital is the higher of €125k or the Fixed Overhead Requirement (FOR) which is £256,252.

The Firm’s Pillar 2 capital is calculated as any additional capital that the firm considers it should hold against any risks that are not adequately covered under the Pillar 1 requirement. The firm has calculated this to be £296,252 (based on management accounts as at 31.3.16).

The firm’s regulatory capital resource requirement is £296,252 which is the unadjusted Pillar 2 capital.

The Firm holds Tier 1 capital of £571,000. This comprises of cash and current assets, less liabilities and produces a surplus over the capital requirement of £274,748.

6. Remuneration

Remuneration currently consists of basic salary for all employees save that the advisers only participate in a bonus scheme. The bonus is both dependent on team performance of core responsibilities in meeting clients needs and treating them fairly. Only once team performance has been met after performing all core functions any wholly compliant adviser (measured against management penalty based KPIs) will become entitled to a bonus equivalent to 5% of new business introduced provided they have also met at least 80% of their annual budget. Although any highest level performance could attract 20% bonus of new income beyond a threshold it is not intended that the bonus element would ever exceed 15% of annual salary.

In 2015/16 the business had a total income of £1,618,031 and this was broken down as follows:

Investment Advisory    £442,382

Financial Planning      £1,185,862

100% of this income came from code staff.

Compiled by David Ian Redfern, Chairman.

These disclosures have been based on the firm’s position as at 31stMarch 2016