Chis Hill is stepping down as CEO of Hargreaves Lansdown. During his time as CEO, the company grew a lot under his leadership.
Hill started working for the investment platform in 2016 as its head of finance. Before that, he had done the same job for the online trading company IG and foreign exchange company Travelex.
The next year, he was put in charge and led the company through the coronavirus pandemic, when lockdowns caused a lot of first-time retail investors to try to make extra money.
Since restrictions have been lifted, the business has slowed down, but the number of assets under management, the number of customers, and the amount of money coming in are still much higher than they were before Covid.
During his time in office, however, the Woodford Equity Income Fund, which Hargreaves heavily promoted and which went bankrupt three years ago, failed. Tens of thousands of investors lost a lot of money because of this.
The Mail on Sunday reported over the weekend that claims management company RGL had sued the FTSE 100 company in the high court. The company had already started legal action against Link Fund Solutions, the corporate director of the fund.
RGL says that Hargreaves kept promoting Neil Woodford’s flagship fund until it stopped trading, even though the company was worried about the fund’s exposure to investments that were hard to sell.
Hargreaves hasn’t said anything about the claim that was sent to court yet. In 2019, Hill did apologize to customers who had been hurt by the scandal.
The Bristol-based investment group said Hill would stay in his job until no later than November 2023 while the board looks for a new leader.
Its chair, Deanna Oppenheimer, said that Hill “has led the company successfully through a time of major change.” He is leaving HL as a stronger company with a clear strategy that is fully supported by the board.
Hargreaves also released a trading update on Monday, which showed that its revenue grew by 15% year-over-year to £162.9 million in the three months that ended in September. This was due to recent increases in interest rates.
This made up for the fact that the number of shares traded dropped from 861,000 per month to around 700,000 per month and that a drop in assets under management hurt revenues.
Even so, the number of active clients has grown by 17,000 since June. This is because more people are using self-invested personal pensions, individual savings accounts, and active savings accounts.
Hill said in a statement, “Even though flows into risky investments remain low, both client and asset retention rates remain strong and about the same as last year.”
Due to the good performance, Hargreaves has raised its estimates for full-year revenue and cash margin, but it has lowered its estimates for share margin.
Monday, Hargreaves Lansdown shares ended the day 1.9% lower at 796.6p. This means that since January, their value has dropped by about 40%.
