London, June 17, 2026, 15:15 BST
- Rathbones shares rose 1.0% to 1,636p at 1447 BST. The stock bounced after a steep drop on Tuesday.
- The wealth manager has stopped some high-risk client activity following an FCA-connected review and is now forecasting £60 million in costs over the next two years.
- CEO Jonathan Sorrell and Chair Clive Bannister picked up roughly £500,000 of shares after the warning.
Rathbones Group shares edged higher in London on Wednesday, recovering some ground after Tuesday’s drop that followed news of a regulatory review. The FTSE 250 wealth manager said restrictions will hit client inflows and push up costs. Shares gained 0.99% to 1,636p at 1447 BST. On Tuesday the stock fell to a 52-week low at 1,582p.
The review is a setback for Rathbones as CEO Jonathan Sorrell pushes to revive the firm’s growth narrative. Wealth managers lean on client inflows for valuation, with fee income tied to assets under management.
Rathbones said a skilled person review tied to talks with the Financial Conduct Authority spotted things to fix in parts of its UK wealth management arm, including how it has rolled out Consumer Duty and some arrangements for compliance, oversight, and assurance. Rathbones plans to stop taking on new clients who need enhanced due diligence, or stricter checks for higher-risk business, for as long as a year. That client set brought in around £370 million in gross inflows last year. The company will also block new money into general investment accounts from some existing clients with those checks, hitting about 4,700 clients, or 4% out of 119,000, who together added about £530 million over the last year.
The FCA says Consumer Duty means firms must act for good outcomes for retail customers. A skilled person review brings in a third party when the regulator has concerns about what a firm is doing or wants more detail.
Rathbones will drop investment management charges on cash held in discretionary portfolios starting July 1. The company expects underlying pretax profit for 2026 to fall by around £9 million as a result. Its dividend policy stays the same. Rathbones said the £20 million buyback already approved by the Prudential Regulation Authority will kick off soon.
Sorrell said Rathbones is “committed to operating to the highest standards” for clients. He added the work backs its aim to be “the best wealth manager in the UK, by far.” The Standard
The company stepped up its message late Tuesday. According to a regulatory filing, Bannister picked up 15,300 shares at £16.38. Sorrell bought 15,320 shares at £16.30.
Rathbones’ integration of Investec Wealth & Investment UK is under the microscope again. The Financial Times said Wednesday that the merger has stretched internal resources and delayed work on new consumer-protection rules, according to a review. The review did not find any deliberate wrongdoing.
The share move stuck out in a sector that keeps a close eye on St James’s Place and Quilter for signs on net flows, fees and regulation. This issue is Rathbones-specific but the market drew a clear line: wealth managers with tricky client bases can’t keep pushing compliance work to the back office.
The risk for Rathbones is that fixing the issue drags out or shakes up advisers and clients. Analysts talking to The Times pointed to possible hits to profit, client inflows and morale. Rathbones is looking at a direct remediation cost of £60 million spread over two years.
