The success of MLC, under the ownership of the National Australia Bank (NAB), in courting the Deutsche Financial Planning advisers to join with Godfrey Pembroke is widely known.
The reason for this being the size of the deal, $115 million for the planning and master trust arms, which landed the highly fancied group and assured the migrating planners of a solid financial package as part of the move.
Since then the Global Wealth Management (GWM) team has been working to integrate them into the overall processes of not only Godfrey Pembroke but the greater structure of the distribution model held by NAB.
According to National Wealth Management head of distribution Steve Tucker the addition of the 65 Deustche planners, along with the non-discretionary master trust business Deutsche Funds Management is close to completion.
So far the number of Godfrey Pembroke advisers has risen to 175 and funds under advice has also been boosted from $3.9 billion to $7.5 billion.
However Tucker says the Deutsche planners were not bought as part of a push to build up numbers.
“It was not just 60 high end planners we picked up in the purchase, rather we don’t think there was a better cultural fit for them,” Tucker says.
“Both Godfrey Pembroke and the previous Deutsche business had high end clients, worked off a fee for service basis and had a focus on advice as the value in the business.”
Tucker says the strategy has been and will continue with the new planners, to target affluent clients and he says the focus will remain on the advice as the product the planner offers.
The integration of the Deutsche planners into Godfrey Pembroke was rapidly concluded, with the new planners coming on board in the space of 90 days, and according to Tucker this demonstrated the power of the GWM model.
The GWM model is actually part of NAB’s retail distribution model which has the GWM team covering all the distribution outlets owned by MLC including Garvan, Apogee and MLC Financial Planning.
All the bank based planners operate under the banner of Australian Financial Services, a subset of GWM.
Sitting below this is the adviser support platforms ThreeSixty and Adviser Solutions headed by Ian Showman and Matt Lawler respectively. The task of these two groups is to provide back office support, compliance and practice management support among other roles.
The third layer is distribution support services which covers areas such as dealer infrastructure and product and platform development and implementation.
The final layer is the product types on offer with platforms and investment vehicles such as MasterKey and Flexiplan, risk products and the banking products offered through NAB branch network.
The addition of the Deutsche planners also boosted the overall numbers to group to around 1700, making NAB one of the bigger owners of distribution and according to Tucker a more complete distribution system.
“We are not running boutiques. The current channels all have critical mass but different propositions for the whole range of clients and planners,” Tucker says.
“All planners have access to all products in a seamless and holistic way and planners can even use our own business banking products for their own business.”
This cross linking of the group’s business has been something Tucker has been keen to exploit for planners in much the same way as planners do for clients.
He says the group is building a planning model which will take advisers from university graduate level through to their own business and create built in succession plans for the group.
At the same time Tucker says any adviser can find a home in the model regardless of the stage of their business. And to sweeten the attraction he also says the group will offer up to four times earnings for a business in any market.
“This puts the adviser in the driver’s seat. It is high but recognises the value made by planners for the group. Advisers love it because it gives certainty and it is real,” Tucker says.
While it may sound like it is designed to draw in more numbers Tucker denies numbers at all costs is the ploy. Rather he says it is about planners creating their own businesses in a secure environment instead of jumping from one to another.
“But we will still be strict on the numbers of planners who can make use of such services because we know some planners will not make it and the quality of advice we provide is the key,” Tucker says.
“We are seeing interest in this from those without a financial planning background as well. However our focus is on supplying these services to our own before chasing hundreds of external parties.”
