Adviser choices will determine if IOOF becomes largest planning group

It will be the number of MLC advisers who choose to join IOOF that will decide whether the dealer group will have the largest number of advisers in the country, according to its chief advice officer.

IOOF chief advice officer, Darren Whereat, told Money Management that the firm was not taking for granted how many advisers would be under their umbrella and that they would need to “win the hearts and minds” of the MLC self-employed advisers.

Whereat said some MLC advisers had asked IOOF specific questions about advice on an individual level and that they would consult their advisory board and formulate responses to those advisers thinking about joining.

“It’s about making sure we have AFSL [Australian Financial Services Licence] sustainability, adviser efficiency and client engagement. We’ll have to make sure our business remains streamlined to make it easier for us to manage,” he said.

Whereat noted the challenge with running a large number of advice businesses was making sure the firms were operating within its risk tolerance and under a set of principles that underpinned goals-based advice.

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“We’ve solved that by adopting a single set of standards for our advisers and audit process. We are also ensuring monitoring and supervision that are under a consistent standard,” he said.

While IOOF had recently announced it would close FSP, EWM and Actuate, Whereat said it was not looking to close anymore as the remaining licences had a unique value proposition and were all operating at scale.

“The ones we are closing over the next nine months were either not operating at scale or did not have a unique proposition. Part of our advice strategy was making sure we were sustainable as an AFSL provider and we couldn’t keep running the business the way we were,” he said.

“You can have multiple AFSLs but only one advice process and we wanted to make all our AFSLs were sustainable businesses.”

He noted that IOOF were not looking to acquire anymore AFSLs as they had their “hands full”.

“But if individual businesses were really liking what we were doing and we found we were a nice fit we wouldn’t walk away from an opportunity but for now there’s nothing on the horizon,” Whereat said.