International bonds are increasingly growing in favour among advisers, according to new findings from Canada Life UK.

The group said that its research, conducted in partnership with the lang cat among UK advice professionals, has indicated that the trajectory is set to continue over the next five years.

Canada Life found that 71 per cent of firms are already using international bonds, and that they indicated they would be using them more than they do currently in five years’ time.

Out of the firms already recommending international bonds to their clients, two thirds (66 per cent) also reported doing so more often than they were five years ago. A third (33 per cent) believe it is about the same, while the remaining one per cent said they are recommending the product less.

The study also revealed that 69 per cent of advisers are expecting an increase in the volume of trusts used alongside an international bond in the next five years.

Managing director of the wealth division at Canada Life UK, Sean Christian, said the international bond market is “gaining real momentum”, as advisers seek solutions that can flex with changing client needs.

“International bonds are a regulated and widely recognised solution that comprise a wide range of investments and valuable estate planning opportunities,” Christian commented. “A shifting tax landscape, with changes to capital gains tax allowances and inheritance tax, means advisers are seeing clear demand for this type of solution.

“With further tax changes speculated at the upcoming Autumn Budget, products like international bonds are likely to come into sharper focus as advisers look to solutions that enable clients to pass on wealth efficiently to their loved ones.”

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