Smaller adviser firms jointly cut platform costs
In a reflection of the evolving commercial environment resulting from the Future of Financial Advice (FOFA) changes, Premium Wealth Management has entered into a deal with Bronny Speed and Angus McLeod's AdviceIQ partners to access the Australian Financial Services Licence underpinning PortfolioIQ.
The result of the arrangement will be that Premium's member stakeholders will take a shareholding in PortfolioIQ and, thereafter, combine the two companies' access to BT Wrap.
The arrangement is regarded as being one of the first among many changes within the financial planning and platforms arena as groups seek to gain cost savings and scale necessary to operate in the new FOFA environment.
Both Speed and Premium Wealth Management general manager Paul Harding-Davis said the arrangement was based on bringing together the companies' two respective BT-badged wraps using the AdviceIQ-developed badge - Adviser Link - operated by Portfolio IQ Pty Limited. Premium Wealth Management will now be a partner in Portfolio IQ.
Confirming the deal to Money Management, Harding-Davis acknowledged that it would generate substantial commercial benefits for both parties, not least in terms of underlying platform costs.
As well, he said that Premium Wealth Management advisers would be using Adviser Link with respect to BT Wrap clients.
Harding-Davis said the arrangement held considerable benefits, with some back-office synergies having already been identified along with a strengthening of the underlying offering.
Speed and McLeod made clear that the AdviceIQ and Premium Wealth Management advice brands would remain unchanged, although "we will of course look for other administration and infrastructure areas [where] we can work together to operate more efficiently or to expand our individual range of services".
"We all agree that small and boutique firms can benefit from sharing knowledge and services, and are likewise united in our view that in a couple of years time there is likely to be a cyclical move of advisers back out of the institutionally-driven groups."
Harding-Davis said the commercial synergies created by the arrangement were such that it was possible some SMSF trustees might find value in accessing a wrap.
Premium Wealth Management currently has 23 practices with 54 authorised representatives and $2.1 billion under advice. AdviceIQ was established in 2009, has practices in Sydney, Melbourne and Brisbane and boasts around $300 million in funds under advice.
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”.
