Lloyds set to take control of Schroders wealth tie-up in ‘mass affluent’ push

Lloyds is set to scrap its wealth management tie-up with Schroders and take control of the unit amid efforts to sharpen its focus on more affluent customers.

The banking group is considering buying out Schroders’ 49.9% stake in Schroders Personal Wealth (SPW).

The deal would hand full control of the venture to Lloyds, six years since the tie-up was formed, as first reported in the Financial Times.

A spokeswoman for Lloyds Banking Group said the bank has “over three million mass affluent customers and its strategic aim is to deepen these relationships including in high value segments”.

“We are building an end-to-end wealth offering, from execution-only digital investments and pensions, to full financial planning and advice through SPW,” Lloyds said.

It is understood that if such a deal went ahead, Lloyds would gain full control of SPW and be in a position to expand its own wealth services.

The joint venture was launched in 2019, enabling Lloyds to access Schroders’ technology and investment platform – while Schroders was opened up to the bank’s vast customer base.

SPW currently serves around 60,000 customers and manages some £17 billion in assets – up from £13 billion in 2019.

Lloyds’ chief executive Charlie Nunn has been spearheading a five-year strategy to transform the bank by making changes it believes will make it stronger for the future.

This has included efforts to lean further into its wealth management services by targeting more affluent customers.

It launched the Lloyds Premier account earlier this year, for customers who pay in at least £5,000 each month or who have £100,000 worth of savings or investments with the bank.

The account offers GP and wellbeing services, lifestyle benefits, travel perks, cashback, discounted mortgage rates and appointments with financial coaches, among its benefits.

At the time, Lloyds said the launch was a “strategically important milestone in our growth ambitions for affluent customers – a part of the market where we have historically been under-represented”.