IOOF believes the $223 million client remediation provisioning it announced in August last year is going to hold good.
The company announced no new provisioning for remediation at the same time as announcing a first reduced half net profit after tax of $115 million on the back of $1.4 billion in total inflows and a reduced fully franked interim dividend of 16 cents per share.
With respect to provisioning, it said further sampling and investigation had “reaffirmed the appropriateness of this original estimate”.
The company also confirmed completion of the ANZ Pensions and Investments business at a renegotiated sale price of $825 million – a reduction of $125 million.
IOOF chief executive, Renato Mota said this had extended the company’s sale and reach with 11 new advice practices joining the advice business which saw advice channel funds under management and advice increase by $985 million to $76.6 billion.
He said IOOF was now the second largest advice business with 1,443 advisers and the fifth largest platform providers by funds under administration.
“We are building long-term scale benefits in our business and we are committed to the reinvention of advice,” he said.
Comments
Some people are surprised that IOOF's remediation provisions are so much lower than the banks. But it is really just an indication that most of the banks' so called "fee for no service" compensation was nothing of the sort. They were primarily PR payments, without ever confirming if service was not delivered or clients were disadvantaged.
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