The Commonwealth Bank has cleared the way for exiting its self-employed adviser ‘Pathways’ franchise.
Financial Wisdom and CFP Pathways general manager, Mark Ballantyne has written to adviser confirming that a Sale and Purchase agreement for the business was now due for final approval and noted that the move took the option of transitioning to Financial Wisdom out of play.
Pathways Advisers have been in negotiation with Commonwealth Financial Planning since late last year with respect to the terms and conditions surrounding the sale of client books which would allow them to continue to the service the clients under a different ownership and licensing structure in the future.
The intention of the Pathways advisers was revealed to the Australian Competition and Consumer Commission (ACCC) in early December which declared that the Commonwealth Financial Planning Pathways Adviser Council intended to collectively bargain with Commonwealth Financial Planning “in relation to the terms, conditions and commercial matters with respect to CFPL’s sale of its Pathways client books”.
“Each participating Pathways Adviser is expected to enter into one or more agreements to give effect to the sale of the relevant client books, which will allow the Pathways Adviser’s financial advisory practice to continue to service these clients under a different ownership and licensing structure in the future,” the ACCC notification said.
It said there were “approximately 60 Pathways Advisers and 46 of these have agreed to participate in the collective bargaining group. The notification provides for the remaining Pathways Advisers to join the group”.
Ballantyne’s note to the Pathways principals stated: “Together with the need to provide you and your team with greater certainty, we will enable you to complete the transaction and apply for your own licence, or move to another licensee”.
“This means you will no longer have the option to transition to Financial Wisdom as previously planned,” his note said.
