Do Australia’s major banks see continuing value in wealth management in circumstances where two of the largest have this year moved to reduce their exposure?
Just weeks after the completion of National Australia Bank’s (NAB’s) transaction selling 80 per cent of its MLC life insurance business to Japan’s Nippon Life, ANZ has flagged the possible sale of its life insurance, advice, and superannuation and investments businesses in Australia with the possibility that it will follow a similar course with respect to New Zealand.
Few observers of the Australian wealth management sector will be surprised by the ANZ move in circumstances where the bank has experienced substantial changes in both strategy and senior personnel where its wealth business has been concerned.
On top of that, has been the degree to which the boards of the major Australian banks have seen wealth management as problematic when returns on investment are weighed against the fall-out from bad publicity around financial planning scandals, subsequent remediation costs and a growing compliance burden.
Any move by ANZ to sell its wealth business will have a significant impact on the shape of the Australian financial planning industry and will force the other major banks to make some tough decisions about their own businesses – whether to grow or retreat.
The ANZ move brings into play ANZ’s dealer groups, Millenium3, RI Advice Group, and Financial Services Partners.
