UK Banks Lose Out As Rich Clients Seek To Minimise Taxes

by Jason Gorringe, Tax-News.com, London

05 February 2002

According to new research from Tulip Financial, the United Kingdom's high street banks are losing out to online and offshore banks, as wealthy clients migrate their assets in order to take advantage of specialist services, investment advice, and assistance with minimising their tax burden.

Tulip surveyed 517 banking clients with average liquid assets of around £300,000, and found that one in five of those questioned was planning to switch accounts, either to an offshore bank, or to a designated HNWI online provider.

Speaking to the Financial Times on Monday, Managing Partner of Tulip John Clemens explained that the banks' failure to provide enough services for rich clients was to blame for the loss of customers: 'People are moving because they can't get the service that they want from the clearing banks,' he observed.

The Tulip report revealed that over the past year, five of the UK's largest banks - Barclays, HSBC, Bank of Scotalnd, Royal Bank of Scotland, and Lloyds TSB- have seen their share of the country's wealthier current account holders fall from 80% to 71%. According to the FT, Lloyds TSB has been hardest hit, and its market share slid from 17% to just 12% in 2001.

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