IOOF sees $2.2b in advice outflows
IOOF’s Advice 2.0 programme has seen an outflow of $1.8 billion while the firm posted an increase of $9.4 billion in funds under management, advice and administration (FUMA) to $213.3 billion during the last quarter of the 2021 financial year.
In an announcement to the Australian Securities Exchange (ASX), IOOF said its financial advice FUMA saw an outflow of $1.8 billion after outflows of $2.2 billion from 33 advisers departing its self-employed advice businesses, and inflows of $0.4 billion from new self-employed advisers joining IOOF licensees and organic inflows.
“This was due to a variety of reasons, including practices which IOOF believe were not suited to the economic or governance requirements of a professional advice model,” it said.
“On 1 June, 2021, 406 MLC advisers joined with IOOF advice licensees and as at the end of June, IOOF maintained active advice services relationships with almost 2,000 financial advisers.”
Source: IOOF
IOOF’s Q4 results also said its newly acquired MLC assets under management and funds under administration were $301.2 billion, up $11.4 billion. It noted that currently IOOF and MLC used different reporting methodology and that an aligned approach would be presented for their full year results.
On the investment management side, FUM increased by $1.4 billion, up 6.2% to $23.5 billion, including $90 million in organic positive flows and market movements.
“These robust organic net inflows reflect the strong support from advisers for the IOOF MultiSeries funds, which offer competitive pricing, strong investment returns, and increasing client engagement through investment central,” it said.
IOOF’s pensions and investments (P&I) FUMA posted outflows of $895 million, which the firm said was consistent with the outflow profile in previous quarters.
It said the P&I integration program had an expected annualised cost synergies of $43.6 million and an additional $8.7 million realised by 30 June, 2021.
IOOF’s portfolio and estate administration FUMA saw $606 million in net inflows, and market movements FUMA saw an uplift of $5.3 billion.
IOOF chief executive, Renato Mota, said: “Ongoing positive organic flows into portfolio and estate administration were experienced, achieving quarter-on-quarter positive flows for the last 34 quarters, as well as a positive turnaround in flows into investment management during the quarter.
“The successful completion of the MLC acquisition has transformed our business in terms of size, scale and reach. The ‘new IOOF’ has over $200 billion of funds under administration across its platforms, in excess of $200 billion of investment funds across its multi-manager and direct investment portfolios, and relationships with more than 9,000 financial advisers, supporting more than two million Australians with their retirement and investment decisions.
“This gives us a strong platform for future growth, including the enhanced ability to attract new FUMA though our extended scale and reach.”
Recommended for you
Licensing regulation should prioritise consumer outcomes over institutional convenience, according to Assured Support, and the compliance firm has suggested an alternative framework to the “licensed and self-licensed” model.
The chair of the Platinum Capital listed investment company admits the vehicle “is at a crossroads” in its 31-year history, with both L1 Capital and Wilson Asset Management bidding to take over its investment management.
AMP has settled on two court proceedings: one class action which affected superannuation members and a second regarding insurer policies.
With a large group of advisers expecting to exit before the 2026 education deadline, an industry expert shares how these practices can best prepare themselves for sale to compete in a “buyer’s market”.
