The Business On... Peter Hargreaves, Executive director, Hargreaves Lansdown
Wednesday 03 August 2011
The City is in a bit of lather over Hargreaves Lansdown, we hear?
Well, the Financial Services Authority has announced a potential ban on payments by fund managers to online platforms that sell their products, such as HL's. Investors fear this will force HL to reshape its business model, which is why its shares fell by up to 10 per cent yesterday.
Oh dear, so Peter's cross again?
Are you referring to Mr Hargreaves' tendency to freely voice his fairly trenchant views on everything and anything? Apparently not. HL has issued a rather bland statement explaining that it is "relaxed about the short and long-term outcomes" and had a variety of "proven revenue models" if the FSA does opt for a ban.
Isn't that rather restrained?
Well HL is no longer run by Mr Hargreaves and his partner Stephen Lansdown. Ian Gorham, an accountant by trade who joined the business in 2009, is the chief executive these days. Mr Hargreaves is still a major presence though, boasting the rather nebulous title of "executive director".
What should we make of this?
Mr Hargreaves might be opinionated but he's not stupid. He's steered the the company, which started off as a two-man band, through a plethora of regulatory upheavals over the years and he'll no doubt steer it through this one too. With Mr Gorham's help of course. Citigroup issued a note yesterday suggesting the share-price fall should be viewed a buying opportunity. Shrewd.
A bit of a hit to his wallet though?
Short term, old boy. Mr Hargreaves practises what he preaches. With the exception of his flash car (a £90,000 Audi) he describes himself as a saver rather than a spender. And he puts lots of his money (including the millions he made when HL floated) into the unit trusts his company is so good at selling, rather than buying shares. Don't worry about him.
No chance of fireworks at all?
Have no fears. Mr Hargreaves, who has advocated a flat tax and has furiously described Bristol (where the company is headquartered) as "anti business", won't be quiet for too long. It's not in his nature.
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