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High Interest Client Accounts

As a firm we continue to look at aspects within legal practices that help to improve the efficiencies and profitability of our clients in the legal industry. We have recently been working with Investec Private Bank's specialised banking division, and have identified a means by which additional revenues can be generated by making your client account funds work harder for you.

Quite often long term deposit arrangements can mean that funds cannot be released until the end of the contract and so this does not comply with SAR rules.

Many of our clients have core funds that sit in their client account earning minimal interest and so an opportunity exists to place these funds in a higher interest account. In the event that these funds need to be drawn down by your client, funds are immediately accessible with one free withdrawal per annum, but inevitably, for any further withdrawals, a financial penalty is levied on the amount withdrawn. This ensures that the account is compatible with SAR regulations whilst opening up an opportunity for much better interest returns on your client account funds.

There are of course other products available in the banking sector that are also compatible with SAR regulations, but we wanted to bring this opportunity to your attention and raise awareness about these products.

Currently the rate being generally offered by the high street banks is 1% and on a client account balance of £250,000 for 12 months this would generate around £2,500 of interest.

The Investec Direct Reserve Account has tiered interest rates paying up to 2.5% (for balances over £500,000).

So funds in this Investec account for the full 12 month period where a return of 2.25% gross AER* is available would generate £5,625 (or additional £ 3,125 over the typical high street client account). This is a one month notice account and requires a minimum deposit of £25,000.

In addition, Investec Private Bank have created the Business High 5 Account, available for Solicitor firms' own money, which consistently pays the average of the 5 highest business deposit rates as published www.Moneyfacts.co.uk. This is a 3 month notice account requires a minimum deposit of £50,000 and is currently paying 2.44% gross AER*.

For more details on both these accounts, and to download an application form, click on the following link: www.investecprivatebank.co.uk/bennettbrooks 

For some this may all still seem daunting, so we are more than happy to talk through any concerns that you may have, and help determine the best product for you and your clients whilst ensuring you remain SAR compliant. We think that is a great return for simply completing a few forms?

 
Call us today on 0845 330 3200 to find out more.
bennettbrooks... work smarter not harder

* ‘Gross’ stands for the rate of interest paid before the deduction of tax. ‘AER’ stands for Annual Equivalent Rate and illustrates what the rate of interest would be if interest was paid and compounded once a year. Interest on qualifying balances is calculated daily and credited to the account on a monthly or annual basis. The rates are correct as at 30 June 2009 and subject to variation. Investec Private Bank is a division of Investec Bank plc, 2 Gresham St, London, EC2V 7QP. Reg. no. 489604. Authorised and regulated by the Financial Services Authority.