Powered by MOMENTUM MEDIA
moneymanagement logo
 
 

TFSA relinquishes ownership to advisers

dealer-group/advisers/financial-advisers/cent/chief-executive/

18 January 2008
| By Justin Knight |

With succession planning, growth and a stock exchange listing in mind, independent dealer group Total Financial

Solutions Australia (TFSA) has implemented a new strategy whereby the company is 100 per cent owned by its financial advisers. By swapping margin for equity, every TFSA adviser has the opportunity to become an owner, with the level of an individual’s shareholding dependent on the revenue they generate. TFSA advisers are also able to purchase additional shares outright or by giving up their commission revenue.

The dealer group’s chief executive Phillip Aris said shareholders voted unanimously in favour of the initiative and that it had been well-received by the advisers. “There is not a limit to how much an adviser can buy and it is not tightly held, so it’s not a case where we have two or three people who own most of the shares, it is quite nicely held throughout the whole group,” he said. “Our largest shareholder has around 10 per cent and we have a couple that own 5 per cent and then the next lot own 2 per cent and a whole lot own 1 per cent.”

Apart from giving TFSA the ability to retain revenue, the margin for equity swap will also aid succession planning within practices, Aris said. “We have some advisers in the early 60s age bracket and they are looking at retiring,” he explained.“ We have encouraged a lot of these guys to bring on new people and they will be issuing some of their shares in TFSA to their own people that work under them.”Describing the approach as “quite unique”, Aris added that it also motivated young advisers to stay with the company.

“We have also encouraged a lot of young people to come into the group by allowing young, new advisers to have free adviser fees for the first year,” he said.

TFSA currently boasts $2 billion funds under advice and more than 100 advisers, making it the 33rd largest dealer group in the country by adviser numbers. It has forecast that it will be ready to list on the stock exchange by 2011.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

The succession dilemma is more than just a matter of commitments.This isn’t simply about younger vs. older advisers. It’...

2 days 2 hours ago

Significant ethical issues there. If a relationship is in the process of breaking down then both parties are likely to b...

3 weeks 6 days ago

It's not licensees not putting them on, it's small businesses (that are licensed) that cannot afford to put them on. The...

1 month ago

After last month’s surprise hold, the Reserve Bank of Australia has announced its latest interest rate decision....

4 weeks ago

ASIC has released the results of the latest adviser exam, with August’s pass mark improving on the sitting from a year ago. ...

4 days 20 hours ago

While the profession continues to see consolidation at the top, Adviser Ratings has compared the business models of Insignia and Entireti and how they are shaping the pro...

1 week 6 days ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND