City firm Withers has stressed that a new cash call on junior partners is not related to current economic conditions. The London-headquartered firm said the decision to ask for contributions of up to £41,500 was taken two years ago and was part of giving partners a greater stake in the business.

In a statement, Withers said: ‘We haven’t issued a general cash call. There has been no change to the capital requirement for senior equity partners. We have asked junior equity partners to provide a capital contribution for the first time of between $25,000-$52,500, depending on seniority, so they are more fully involved in the ownership of the business.’

There has been speculation in the financial press that other firms could follow with their own cash call on partners.

Withers, which specialises in services for high net-worth clients, last month posted its results for the year ended 30 June 2022. Chief executive Margaret Robertson stated that members capital requirements were determined ‘from time to time having regard to the short, medium and long terms needs of the business’. She added that the firm operated a drawings policy ‘which has regard to a cautious estimate of budgeted profits’ and which restricted drawings to ‘prudent levels’.

During the year, profit before tax fell by 4% to £32.9m despite turnover increasing marginally to £133m. The profit available for discretionary division among members fell from £33.5m to £32.6m, with cash reserves down from £7.1m to £3.7m.

 

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