The Future of Financial Advice (FOFA) reforms will mean advice groups will either move down the vertical integration path towards a hybrid model or focus purely on the professional advice model, according to WHK head of financial services John Cowan.
FOFA changes have helped WHK focus its business model from a group of disparate businesses. WHK will now focus purely on a financial advice model rather than going down the increasingly popular vertical integration path, he said.
The vertically integrated model has been favoured by some larger groups such as Count and DKN, who were headed down that path even before their moves to align with CBA and IOOF respectively. The vertically integrated or institutional financial advice model will suit those clients who do not wish to pay a "professional" fee for advice and hope to receive financial advice for $300, Cowan said.
The sales of groups like DKN and Count to institutions will also provide an opportunity for the remaining non-aligned groups such as WHK to pick up quality advisers who do not wish to work under the institutional model, he said.
WHK is looking at a measured approach to growth, and would be open to conversations with both individual advisers and practices that would be a cultural fit for the group, he said.
WHK now uses a badged wrap platform from BT that does not feature volume rebates. This agreement is a clear sign of the group’s FOFA readiness and commitment to lower fees, Cowan said.
