At the same time as some AMP Limited advisers seek legal advice on exercising their buyer of last resort (BOLR) options, IOOF has offered advisers within its newly-acquired ANZ dealer groups what it is describing as an “Adviser Recognition Program”.
Money Management has obtained documentation signed by IOOF’s group general manger, Wealth Management, Renato Mota offering advisers within Millennium 3 the opportunity to participate in the Adviser Recognition Program which his letter claims is “designed to complement the existing Licensee offer and reward the right behaviour generated by long-term business partnerships”.
The IOOF letter comes as AMP Limited planners seeking to exercise their BOLR rights have complained about the “weaponizing” of compliance and makes clear that IOOF advisers will also be judged by their compliance record.
The arrangement has a three-year vesting period and, importantly, the letter makes very clear that the advisers can only benefit if they are continually licensed with an IOOF group licensee, consistently achieve positive audit ratings and comply with all necessary regulatory and disclosure requirements.
The letter states that practice principals who meet the following conditions will be eligible to participate in the program:
• Their practice must generate over $250,000 annual advice revenue.
• Advisers within practices (as nominated by the Practice Principals) will be eligible for performance rights over IOOF equity.
• The value of the performance rights offered to each practice will be equivalent to 10 per cent of the practice’s annual advice revenue up to 30 September 2018, up to $3 million in revenue.
• For the purposes of calculating the performance rights, practices with annual adviser revenue that exceeds $3 million will be capped at $3 million.
• A performance right will have a dollar value, whereby the number of IOOF shares the performance right provides on vesting will be determined by the volume weighted average price (’VWAP’) of the shares over the five trading days before the date the performance right is exercised.
Importantly, the letter then states a performance right can only vest if, over the three-year vesting period, the adviser:
• is continually licensed with an IOOF group licensee;
• consistently achieves positive audit ratings; and
• complies with all necessary regulatory and disclosure requirements.
