The expertise and experience of retail brokers should be valued

THE announcement by DBS Bank in February that it will be transferring its retail stockbroking trading arm to the main bank by end-2019 sparked off a spirited response from some members of the public, including remisiers themselves.

In a nutshell, remisiers argued that it would be unfair if the transfer leads to their being displaced with no proper compensation since they have spent decades building their businesses. Moreover, their wealth of market experience and loyalty should surely count for something? On the other side, however, were those who argued that the service that remisiers provide is archaic and possibly even irrelevant in today's online world when rock-bottom commissions are what an increasingly savvy investing public demands.

All too briefly, however, the topic then disappeared from the news front, replaced by more pressing issues of the day. This is probably because the plight of retail brokers has been known for some 20 years since the market deregulated from 2000 onwards. Declining commissions, the advent of the Internet and alternative trading platforms, a loss of investor confidence brought on by various market shocks, and perhaps most importantly, a shorter settlement period which has almost eliminated "contra" trading, have combined to marginalise remisiers over the past two decades.