This week saw a significant drop in adviser role numbers as 100 advisers exit the industry, driving the overall number of advisers to 19,953, according to HFS Consulting’s weekly analysis of the Australian Securities and Investments Commission (ASIC) Financial Adviser Register (FAR).
HFS Consulting’s director, Colin Williams, said that the drop this week were dominated by SMSF Advisers Network, which offers limited advice support services, was down 48 roles. The company fell within the broader trend which saw licensees with limited advice services falling away.
According to Williams, this trend would continue to grow in the coming months.
Williams also stressed the main reason behind losses associated with limited advice were that advisers were opting not to proceed with the Financial Adviser Standards and Ethics Authority (FASEA) requirements and the amount of exam passes at groups with restricted licensees was very low.
SMSF Adviser Network was followed this week by MLC Group, Easton, and Rice Warner which were all down by 18, 10 and seven adviser roles, respectively.
Source: HFS Consulting
Williams said what could be an interesting number to follow was the combined number of MLC Group and IOOF advisers which are current sitting at 1,534 with 1,111 at IOOF and 423 at MLC.
“This is larger than AMP Group at 1,443. However, AMP Group has slowed its losses and ‘may’ retain their number one position post IOOF /MLC becoming a combined business with the current variance between the conglomerates being 91 while at the start of the year it was 224,” Williams said.
“As for growth at the licensee owner level, Centrepoint Group have leapfrogged Count Financial to join Oreana with a net gain of 15 adviser roles each. And Count slipped to third with a gain of 14 closely followed by Fortnum with 12.”
Comments
Don't worry. The banks are returning to financial advice, bigger and better than ever. Thanks to Hayne we'll see history repeat itself. What we should have had from the RC is a strong independent profession backed by their own professional organisations that put the members first instead of the sponsors. That way there would be a strong ethical and competent group standing in the way of these crooks. Get ready for RC 2.0.
Welcome to the Wild West where accountants drop their limited licence and go back to unregulated verbal advice (ASIC are not interested in prosecuting them, so why bother), conflicted industry fund salespeople are allowed to call their sales pitches advice and they can take fees without getting consent, don't disclose the adviser remuneration and in most cases don't deliver any service, and those hawking dodgy cryposcams via social media are given the greenlight by the financial services minister. Meanwhile, honest, hard-working financial advisers with client satisfaction levels rivalling the most trusted professions, are being hounded out of business by obscene levels of red tape and a deliberately destruction, blood thirsty regulator, aided and abetted by the worst Coalition government this country has ever seen.
Yep well said George.
So sad, so conflicted, so freaking stuffed up, but so true you are.
what the government and all and sundry don't realize is that they have been had, the big institutions used regulatory hurdles to kill off all smaller businesses, who just can't comply with the 1,000,000 requirements well enough to be sufficiently profitable to stay in business.
adviser numbers should drop to 15,000 by 1 Jan 2022, then 3 to 4k drop each year to 2025 and then probably finish at 5,000 1 Jan 2026
once the adviser population is decimated, the big banks will jump in. they are already getting ready for the time to come back in.
it's not like they will take years to enter the space, they can turn the tap on and off at will and they are investing in technology to get ready.
I agree 100% with this. I work as an adviser in a big bank. I can tell you that the red tape for face to face advice is as bad in here as it is for IFA's. You are right that tech is being worked on in the background to fill the space. They have started by lobbying for easier regulation in limited advice but it will not stop there. For life companies, it will be like a return to the tied adviser days, except the advisers will mostly be Robo's.
the big institutions are not stupid. which bank? yes, that one is spending billions on technology and they will go direct to consumer in both mortgages (they are anchor products on the back of which they can sell savings and deposit accounts, and life insurance, research shows if you have 3 or more products with the one institution consumers are very reluctant to move) and other services. https://www.youtube.com/watch?v=oYQaYJxCltY for those born after 1986 see youtube.
that would be just fine and dandy if they did the right thing. but power corrupts and absolute power corrupts absolutely. isn't our whole system of democracy built on checks and balances so that this doesn't happen. why would it be any different for business?
these big instos hire a lot of MBA's. Harvard MBA's are not stupid except for George W Bush.
somebody did their work at Harvard and studied Porter's five forces.
bargaining power of suppliers - 0 Gonski
the threat of new entrants - 0 Gonski
the threat of substitutes - 0 Gonski, good luck
bargaining power of buyers - 0 Gonski, good luck
our small economy naturally produces monopolies.
good luck to the mum's and dad's and good luck to the government trying to undo it all. if you lose half the adviser population which will be the case by 2026, it will be very difficult to bring back competition.
look at the supply into the industry of new entrants they are 5 to 9 people so, in single digits, it will take a very very long time if ever, before this can be fixed.
I have been so concerned I even wrote to the ACCC because I thought they should wade in, they acknowledged my submission.
Does anyone else think it highly suspicious that the "father of FOFA" now works in the private sector and is a director and investor in a robo advice company that provides low cost financial advice to the mass market?
who is the father of fofa? or what's the name of the robo company
Bernie Rippoll
No I don't find it suspicious.
Of course you wouldn't Bernie :)
dont forget union super and Labor also have billions of $FUA and fees to gain with our demise. Blaming simply the retail side for something orchestrated by Labor is kinda mental.
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