Rathbones plans RDR-ready share class launches

Rathbone Unit Trust Management (RUTM) is planning to launch clean, low-cost share classes priced at 0.75% AMC across its fund range next year.

The group, which has a range of well-known funds including Carl Stick's £432m Rathbone Income fund as well as David Coombs' range of Multi-Asset portfolios, currently only has retail units available across the majority of its funds.

However, the group is looking at launching institutional share classes priced at 0.75% - which have trail commission and platform charges stripped out - in the first quarter of next year.

Mike Webb (pictured), chief executive of Rathbones, said: "We are still looking at it, and my thinking is we will need factory gate pricing.

"It would be institutional share classes with a minimum entry point, as we do not currently offer institutional share classes with the exception of the recently launched Strategic Bond fund."

While plans are not yet finalised, the new share classes would sit alongside the existing retail units, with most funds priced at 0.75% AMC. The lower cost Ethical Bond fund - which has an AMC of 1.25% and is run by Bryn Jones - would be charged at 0.625%.

The group's Strategic Bond fund already has an institutional share class priced at 0.5% which would not change under the proposals.

Webb said the launches, which are not yet finalised, would help meet post-RDR requirements from platforms and discretionary wealth managers.

Schroders recently unveiled its own plans to launch clean share classes priced at around 0.75% across all its fund range, despite the lack of final rules from the FSA around pricing and rebates.

However, there remains much debate among fund groups around how to price products after 2012, with new rules around charging transparency forcing all businesses to look at their models.

Some groups are understood to be considering offering share classes which only have commission stripped out, with the platform fee remaining.

Platform giant Cofunds has already called on fund groups to commit to launching clean share classes but other platforms are allowing more flexibility.