Coutts Woman

A question of trust

It was the local bank manager’s sales pitch on the trust business that first attracted Steve Harvey to this area of banking.  Back then, he was sitting in a classroom listening to the career talk on different areas he and his classmates could pursue in the banking world.

“I remember him telling us that you come across so many different people and situations in the trust business.  It was a good sales pitch,” admits Steve, head of the trustee department at Coutts, “because there aren’t too many days which are alike.” 

Steve joined NatWest’s Trust and Tax department directly after leaving school.  Since then, he has worked 35 years in the area - first for NatWest in different locations including Jersey and the Isle of Man, before moving to Coutts in the mid-90s. 

But, what exactly is a trust?  Having to explain what a trust is comes as no surprise to Steve.  “I didn’t know what a trust was before I went into the banking world.  And I don’t think many people really understand them now.  They’re aimed at wealthier individuals so not all people necessarily need to know about them.”

According to Steve, trusts are essentially a family protection/tax planning vehicle. People put money into a trust for the benefit of other people – usually children or family members.  This money is relatively tax-free and looked after by the bank until the decision is taken to release the trust to the beneficiaries.  “It’s a very simple tax-planning and inheritance tool really,” he admits.

In the past, trusts were usually set up under wills.  “One of the most interesting ones was when a man left his wife six pence for the gas meter and a pair of trousers, adding that she’d worn them more than him during their life together!” he laughs.  “That’s the sort of things you came across in the old world.”

“Meeting people is the best part of this job. You tend to get quite close to families”

These days, a lot more lifetime trusts are set up separately of wills, with the client and Steve sitting down together, going through the family’s history, the children, and working out how a trust may be suitable for them. 

“Meeting people is the best part of this job.  You tend to get quite close to families and children because the nature of a trust involves knowing what’s going on with the family and children a lot of the time.”

This is where a large portion of being a trustee comes in.  Before trust funds are inherited by beneficiaries, they can approach Steve about releasing funds for a specific reason or purchase, such as a car, or holiday or home.

“We make the decisions and take responsibility for the trust until the beneficiary is ready to inherit it.  But we have guidelines from the client when the trust is set up.  So, when children come to us asking for money for a car, if they come for a Ford Fiesta, it’s generally fine.  But if they come asking for a Ferrari, then you’re more than likely going to have to turn them down.  Those are the types of decisions you have to make,” admits Steve.

And what about the reactions he gets? “Fortunately, we are independent and not the beneficiary’s parents, so they don’t really jump up and down when their request is denied.  In some cases, parents love to be able to tell their children to go to the bank about their money because they don’t have any control over it.  They see us as a sort of intermediate step to their children handling money,” he explains.

On working in the world of trusts, Steve is the first to admit the job isn’t for everyone.  “Some people will look at tax legislation and think ‘boring’.  But others will read it and love it.  There is a lot of reading involved though, so you’ve got to be prepared to sit down and go through the legislation and tax changes because they’re continually changing and you have to make sure you’re able to deal with any client situation.  Legislation has moved on significantly from where it was 12 months ago.”

And Steve’s view?  “I’m continuously challenged.  As well as staying up to date, you have to be a jack of all trades in trusts because you get involved in a lot of different fields.  You deal with lawyers, accountants, estate agents, and you handle a vast range of assets.  So, boring?  I don’t think so. But it’s horses for courses, I suppose.”