Money Management’s TOP 100 Financial Planning Group research has underlined just how dramatic the exit of three of the four major banks will be for the shape and texture of the financial planning industry.
The expected National Bank of Australia (NAB) exit of key elements of its wealth management business, which includes MLC and excludes JB Were and nabtrade, would mean an outflow of more than 800 planners.
Although the total number of planners working across all major MLC’s brands went down by six per cent from over 1,300 in 2017.
However, it is very likely that NAB could keep NAB Financial Planning which, according to the Australian Securities and Investments Commission’s (ASIC) Financial Adviser Register (FAR), had close to 450 planners.
In May NAB announced plans to follow its competitors and substantially exit wealth management in Australia in order to focus more on its core business and move to “a simpler wealth offering”.
Following that announcement, the Finance Sector Union of Australia estimated that the NAB’s move to exit its MLC wealth division could trigger another round of redundancies that could see staff cuts at the bank of almost 20 per cent.
At the same time, the aligned groups owned by the Big Four and AMP were registered by Money Management’s research as recording a drop in their total number of planners of close to 800, counting year-on-year - a much higher figure compared to the departure of around 600 advisers a year ago.
By contrast, the Money Management’s survey found IOOF-owned groups (Bridges Financial Services, Lonsdale Financial Group, Ord Minnett, Shadforth Financial Group and Consultum Financial Advisers) saw altogether a 2.1 increase in a number of planners to over 900.
What is more, this number was expected to further grow by around 650 planners as ANZ Wealth licensees are preparing to join IOOF next week.
In October last year, IOOF and ANZ agreed to enter a transaction under which ANZ Wealth Management, which consisted of four aligned dealer groups (RI Advice, Millennium 3, Financial Services Partners and Elders Financial Planning), would be acquired by IOOF.
The move was expected to boost IOOF’s advice business to become the second largest advice business by adviser numbers and would further strengthen its position as the second largest advice business by funds under advice, it said.