DBS claims it is Britain's biggest independent financial adviser. Its 1,100 member firms have 1,600 advisers and generated commission income of about pounds 50m last year.
Ken Davy, DBS's founder and chairman, says the network's membership could grow rapidly in the coming months as the introduction of the Personal Investment Authority prompts small advisers to surrender their independence and join a bigger organisation.
DBS takes responsibility for regulatory compliance, making checks on about 200 members each month. It also offers computer software, and provides help with training and business development.
Although DBS does not own its member firms, it can use its size to secure better commission terms from life insurance companies.
Mr Davy said DBS accepted only three out of every 20 financial advisers who wanted to become members. But it has not avoided problems with home income plans, where typically elderly home- owners re-mortgaged properties to release money for investment. Rising interest rates and a housing slump left many in difficulties.
Provisions of pounds 3.6m to compensate about 100 home income plan investors have badly affected DBS's recent profits. Before this cost, it made pounds 2m in the year to March 1993 and pounds 1.4m in the first half of the year just finished.
Mr Davy is relaxed about personal pension transfers business, where regulators are investigating evidence of widespread mis-selling in the industry. DBS has about 100 personal pension clients who opted out of an occupational pension scheme. Mr Davy is confident any compensation bill will be limited by indemnity insurance.
DBS arranges about 25,000 mortgages a year, enough, Mr Davy said, to put it just outside the top 10 building societies. However, the company is little known outside the life insurance industry since its members trade under their own names, many working from home.Reuse content