JAPANESE INSURERS MAY OFFER WRAP ACCOUNTS

Japan’s Financial Services Agency (FSA) could allow insurers and banks to market wrap accounts from as early as next year, reports Nihon Keizai Shimbun . The move was thought likely to stipulate fierce competition amongst companies as the baby boomer generation reaches retirement age. The FSA is reported to be likely to revise legislation that will permit financial services companies to offer wrap accounts through sales representatives as well as at branches. Under current legislation, insurers and banks can refer customers to securities houses, but cannot actively advertise or push the service. Currently the entry barrier to wrap accounts is rather high, ranging from ¥20m at Mizhuo Securities to ¥300m at Nomura, with only about 23,500 accounts in existence at the end of March. The entry of banks and insurers into the sector is thought likely to widen acceptance of the product.