Hargreaves Lansdown boss: Woodford should do the 'right thing' over fees

Hargreaves Lansdown's chief executive has again called on Neil Woodford to stop charging fees for investors trapped in his suspended fund.

Stockbrokers Hargreaves Lansdown were the biggest investors in the Woodford Equity Income Fund, which was suspended earlier this year following a surge in withdrawals.

Mr Woodford's fund had a value of more than £10bn at its height but has shrunk to a reported £3.7bn.

Hargreaves Lansdown chief executive Chris Hill said his firm had waived a platform administration fee on direct holdings in this fund, costing the group £360,000 a month in lost revenue.

Hargreaves Lansdown removed the Woodford fund from its closely-watched Wealth 50 list, where it had controversially remained while sustaining much of its losses.

The Woodford fund itself, however, has continued to collect fees from investors, despite being suspended until at least December.

Regarding the fees, Mr Hill said: "We believe that Woodford Investment Management should suspend collecting its fees whilst their investors cannot access their cash.

"This is the right thing for them to do."

More than 290,000 Hargreaves Lansdown customers were reportedly affected by the fund's suspension and they have around £1.6bn invested.

Mr Hill also confirmed reports that he and chief financial officer Philip Johnson will give up their 2019 bonuses, having only previously said they would not take them while the fund was suspended.

Mr Hill, who took home a £1.7m bonus last year according to the Financial Times, said he shared the "disappointment and frustration" felt by clients over the Woodford saga.

He added: "I am determined that we learn from events such as these.

"I have apologised to all clients who have been impacted by the recent problems because we all share their disappointment and frustration.

"In these difficult times we recognise the financial and personal impact the gating of the fund has had on them.

"Philip and I, together with the unanimous support of the board, have therefore decided that we will not take a bonus award for 2019."

Mr Johnson reportedly earned a bonus of £997,000 last year.

The appeal came as Hargreaves Lansdown reported a 5% rise in pre-tax profits to £305.8m for the year to 30 June.

Total assets under administration grew 8% to £99.3bn, but net new business inflows fell 4% to £7.3bn.

Its shares rose almost 12% in Thursday trading.

Hargreaves Lansdown is the UK's largest direct to investor investment service administering investments for more than 1.2 million clients.

Meanwhile, Mr Woodford's fund was dealt a blow on Wednesday after more than £1bn was wiped from the value of Burford Capital.

Burford Capital is the second-largest holding in the Woodford fund and its shares lost 65% in 24 hours after a US hedge fund took a short position on its stock and attacked its financial status.

Burford's market value recovered some of that lost ground on Thursday - rising 25%.