Which licensees led adviser growth and losses in FY24?

Wealth Data has unveiled the top 10 financial advice licensees in terms of adviser gains and declines for FY2023–24.

Examining licensee growth over the 12-month period, Centrepoint Alliance came out on top with a net increase of 41 advisers, representing an 8 per cent growth out of its 551 total advisers.

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The firm was enjoying consistent adviser growth over the year, while it “looks in its own backyard” for additional growth across its over 530 licensed and self-licensed firms in the Centrepoint network with a strong pipeline in place.

Shaw and Partners followed with a growth of 30 advisers, marking the highest percentage growth at 17.3 per cent out of its 203 total advisers. The licensee previously took the second spot for adviser growth in the 2023 calendar year, with Sequoia Group in first position.

Lifespan Financial Planning came in third place for FY24 growth with a rise of 19 advisers, or 7.5 per cent growth out of its 274 total advisers.

The top five advice firms with the highest growth are:

In terms of adviser declines, Wealth Data founder Colin Williams noted that licensees which made acquisitions over the financial year also inherited the previous losses of the purchased licensees.

Count lost 102 advisers over the 12-month period and currently stands at 672 advisers. The firm’s Merit Wealth, which was previously part of Diverger, drove most of its losses, with a large number being “restricted” advisers who generally only provide self-managed super fund (SMSF) admin advice. Count also purchased Affinia from TAL in May 2023 and progressively moved most of the advisers to the Count licensee.

AMP Group came in second position with a decline of 73 advisers, but still leads the way as Australia’s largest licensee with 828 advisers.

Despite the firm seeing a notable loss, Williams acknowledged: “To AMP’s credit, as a group they have done better than most at putting on new entrants. I believe AMP came out and said they had attracted small self-licensed advisers who were using services such as training and compliance using their Jigsaw division.”

In February, AMP chief executive Alexis George noted the firm was seeing advice practices come to AMP for the first time. “We are seeing many more inquiries than we clearly have over the years preceding,” she said.

Insignia Financial fell by 54 advisers and currently remains as the second largest licensee with 716 advisers. The firm has been undergoing significant operational changes, unveiling its new operating model and executive team under the leadership of chief executive Scott Hartley last week.

After the Financial Link Group, WT Financial Group ranked in fifth place for FY24 adviser losses with a decline of 42. This was due to the licensee’s purchase of Millennium3 from Insignia late last year, so the newly acquired licensee accounted for 33 of the group’s overall losses.

The top five advice firms with the largest declines are:

Moreover, the financial year saw 117 new licensees open and 77 close, a slightly better ratio than in FY2022–23 when 125 licensees opened and 92 closed.

Among the 92 new licensees that fall within the financial planning category, none currently have more than 10 advisers – 51 only have one adviser, 25 have two advisers, 11 have three to four advisers, and five have five to nine advisers.

Similarly, there is currently only one financial planning licensee that began in FY22–23 that has 20 or more advisers, while more than half have either one or two advisers.

Year in review

While the final two weeks of June spoiled the growth in adviser numbers for FY23–24, exits from the profession continued to slow. The 2023–24 financial year ended with a net loss of 211 advisers from the profession.

This was despite the figures spending most of the financial year in the green, but the positive signs were dashed by a flurry of exits to close out the period – between 16 and 30 June, there was a net loss of 236 advisers.

However, even with the heavy losses late in the financial year, it was still a stronger result than FY22–23, which saw a net loss of 633 advisers. Williams attributed the “severe” losses to the final FASEA exam for existing advisers in September 2022, resulting in a larger number being removed from the Financial Adviser Register (FAR).

Looking at the number of new entrants joining the advice profession, Wealth Data said there were 376 that entered for the first time in FY23–24.

“The math shows that a net loss occurred of (-599), between those that have resigned and ceased (975) and new entrants that are ‘current’ (376). The actual net loss for the financial year is (-211). The variance between the net losses is 388,” Williams said.

“This variance is advisers who have found a way to get back into advice. We know from previous media releases from ASIC that there are some 4,000 ‘candidates’ that have passed the financial adviser exam but are not currently on the FAR.”