The vast majority of IOOF advisers will be self-employed or self-licensed moving into the future with the company’s chief executive, Renato Mota, making no apologies for the strategy it is pursuing in the financial advice space.
What is more, Mota has told Money Management that while he expects that, ultimately, IOOF adviser numbers will grow “and grow actively” there will be those who choose or are forced to leave because they do not meet or like the company’s strategy and expectations.
Releasing a strong half-year result, IOOF revealed to investors that it is expecting a fully salaried network of 292 adviser under its Shadforth license, 893 self-employed advisers under the Millenium3, RI Advice and Consultium licenses and 83 businesses comprising 361 advisers utilising its IOOF Services business.
However with respect to the self-employed advisers, the investor pack forecast a reduction in the number of advisers of around 140 as its Advice 2.0 implementation continued in circumstances where the Advice 2.0 model is predicated in large measure upon the removal of product subsidies to develop businesses which are viable on a standalone basis.
Acknowledging the leakage of some former MLC Wealth advisers to other licensees including Count Financial, Mota said that the reality of the advice model IOOF is pursuing was that it would not be acceptable to everyone.
“We are removing product subsidies,” he said. “We do not believe they are acceptable and that means that we are looking to achieve the right size and cost-base.
Mota said that once that had been achieved he believed the IOOF advice business would grow and grow actively but that the relationship between the company and its advisers, particularly self-employed advisers, needed to be a “true partnership”.