This week the top five biggest financial planning groups, which collectively have over 5,400 advisers accounting for 25.5% of all adviser roles, have reported a total loss of 935 roles year-to-date while the sale of Paregem to Easton Investments has helped create the fifth largest ‘group holding’ of licensees, according to HFS Consulting.
The firm’s director Colin Williams pointed out that while the largest groups were struggling to grow bigger in the current environment, the mid-tier groups were on the other side of the spectrum and continued to add adviser roles.
According to HFS’s data, the biggest player by adviser number AMP with over 1,700 adviser roles has lost almost 400 (388) roles year-to-date while the second-largest IOOF (1,306 adviser roles) has seen a departure of 150 roles since the start of the year.
This was in line with the Money Management’s TOP Financial Planning Groups ranking, which was published earlier this month, and also found a number of changes across mid-tier sized groups.
Easton Investments, which entered this week in an agreement with HUB24 regarding the acquisition of Paregem, had jointly almost 600 advisers (592) spread across its three licenses: Merit Wealth, GPS Wealth and The SMSF Expert, as of July, 2020.
However, according to Money Management’s study, Easton’s biggest licensee Merit Wealth stressed that excluding accountants its total number of active authorised representatives who were engaged as financial planners as their primary roles stood at 35 (as of July) against 291 representatives who were accountants.
It would be expected that the recent transaction regarding the purchase of Paragem, with had 76 active authorised representatives who were financial planners at the end of July, would help Easton push its total number of advisers much higher.
HFS’ data confirmed that all companies operating currently under Easton’s umbrella have currently more than 660 adviser roles and have seen a departure of 82 adviser roles year-to-date.
“As you can see from the numbers above, being big does not mean you can naturally grow bigger in the current environment. The growth businesses can best be described as mid-tier groups,” Williams said.
He said that Castleguard Trust (owned by Lifespan) who had 259 roles has managed to add 60 new roles, and was followed by Sequoia with 396 roles which has managed to grow by 56.
Other mid-tier groups doing well, according to HFS and managed to grow by 20 or more advisers, included: Fortnum Private Wealth, Capstone Financial Planning and Infocus Securities.
