Instos may face retention challenge in strong markets
Financial advisers who are viewing institutions as a "safe port in the storm" may be tempted to venture back to a boutique or non-aligned business model when we eventually return to a growth or bull market, according to the Forte Asset Solutions director Steve Prendeville.
Currently around 90 per cent of funds under management in Australia is controlled by the major institutions - a trend that continues to increase, most recently with the acquisition of Plan B by IOOF, Prendeville said.
There aren't many independent dealer groups that aren't for sale at the moment, but it is similar to the battle for adviser talent back in the early nineties between AMP and National Mutual, the ancestor of AXA AP, he said.
"We're going back to that pattern, but as soon as that storm has passed we'll see boutiques once again flourish, the consumer will seek points of differentiation rather than the homogenised advice we're likely to get with larger institutions and only two software packages," he said.
Challenges to the non-aligned business model, such as the removal of volume bonuses, is not front of mind for advisers at the moment, but there will be a challenge on institutions for retention once we come back to a growth or bull market environment, Prendeville said.
Recommended for you
While M&A has ramped up nationwide, three advice heads have explored Western Australia’s emergence as a region of interest among medium-sized firms vying for growth opportunities in an increasingly competitive market.
The Australian Financial Complaints Authority has reported an 18 per cent increase in investment and advice complaints received in the financial year 2025, rebounding from the previous year’s 26 per cent dip.
EY has broken down which uses of artificial intelligence are presenting the most benefits for wealth managers as well as whether it will impact employee headcounts.
Advice licensee Sequoia Financial Group has promoted Sophie Chen as an executive director, following her work on the firm’s Asia Pacific strategy.
