Numis warns that Mifid rules shake-up won’t help pensions

MiFID II, the ground breaking EU regulation that is supposed to boost everyone’s pension fund, is unlikely to work, says the boss of City stockbroker Numis Securities.

Alex Ham, the co-chief executive alongside Ross Mitchinson, says the theory that it will cut costs is unlikely to be matched in reality.

Describing the Markets in Financial Instruments Directive as “something to get through” he said: “In theory the regulators want to look after the lady in the street. It is difficult for fund management companies to cut fees though. That would suggest they have been overcharging her for all these years.”

He was talking after a strong second half of the year boosted Numis’ results. The 250 folk who work in Paternoster Square in the City made revenue of £130 million, up 16%. Profits rose 18% to £38 million, allowing the 12p divi – worth £13 million to shareholders – to be maintained.

Ham is sanguine about Brexit. “Brexit will be what it will be. We don’t think it will have that big effect on our business.”

Small and mid-cap brokers have been under pressure for years, with many predicting the near demise of the sector.

“Some of the weaker ones have struggled,” says Mitchinson. “There has always been talk of consolidation, but we’ve never made an acquisition. We think we are in pretty rude health.”

Aim-listed Numis raised £2.5 billion for clients in the year to September. That included seven floats and 38 secondary raises.

It has 15 people in New York pushing UK equities.

The shares slipped 11p to 297p.