PARIS - French insurer AXA plans to cut 450 financial advisory jobs at its UK banking joint venture, saying new commission rules make it tough to turn a profit providing such advice.
AXA said in a statement on its UK website that the decision to stop providing financial advice at the branches of its two UK banking partners, the Co-operative Banking Group and Clydesdale and Yorkshire Banks, came after a strategic review.
"We are very disappointed that AXA UK must also now withdraw this service having not found a model which balanced the regulatory requirement that the service be profitable in its own right, whilst setting advice fees at an affordable level," AXA UK Chief Executive Paul Evans said in the statement.
The move follows the implementation of Britain's Retail Distribution Review (RDR), which came into force at the start of 2013 has replaced selling financial products to private investors for commissions with a system of fees, emulating the model employed by professions, such as the law.
The reforms, alongside higher barriers to entry for those wishing to sell financial advice, such as more rigorous qualifications, aim to ensure investors are offered what matches their needs rather than what pays the salesman the best commission.