With the growth of micro-AFSLs and new licensees in a shifting advice landscape, business development managers (BDMs) face new challenges to find the advisers authorised to offer investments, according to Wealth Data.
While BDMs were once able to access a large portion of the adviser population by simply knocking on the doors of the big four banks and large licensees like Insignia (IOOF) and AMP, this has now changed dramatically, the research house said.
“As the banks pulled out, their licensees have been sold or left to dissolve on their own accord. We have also seen the growth of the micro-AFSLs. Along the way, we also saw the introduction of the accounting – limited advice AFSL who only offer SMSF administrative advice. The challenge today for the BDMs is finding the advisers who are authorised to offer investments,” explained Colin Williams, Wealth Data founder.
Based on this week’s adviser movements, he said there are currently 15,700 advisers operating out of 1,844 licensees. However, not all can offer investments via a Wrap.
Looking at the ‘contestable adviser’ market of those authorised to offer such investments to the public, the grand total stands at some 14,058 advisers spread across 1,609 licensees.
Williams noted this translates to an average of 8.74 advisers per licensee.
“As for the advisers working in licensees of less than 20 advisers, there are 4,683 advisers working out of 1,476 licensees and an average of 3.17 advisers per licensee,” he explained.
“To make matters more complex for the BDM, the number of new licensees keeps growing; so far this year we have seen 76 new licensees, and since 2020, the total is a staggering 491, almost all micro-AFSLs.”
In terms of adviser numbers, there was a net change of -12 in the week to 31 August and -99 for the calendar year to date.
In the new financial year to date, there is a net change of +134.
The research house found growth this week to be moderate, mostly driven by advisers leaving the NextGen Financial Group, owned by the Financial Link Group.
A new licensee owner commenced this week with two advisers, both moving away from Fortnum.
AD Financial Services, LFG Financial Services and Castleguard Trust (Lifespan) were up by net two advisers. In all cases, the advisers had switched across from NextGen.
There were 18 licensee owners who were up by net one each, including Steinhardt Holdings (Infocus), Morgans, Centrepoint and Insignia who appointed three and lost two advisers.
In terms of losses, the Financial Link Group (NextGen) lost 10 advisers. Of the 10 that came off the FAR this week, five were appointed elsewhere.
Some 19 licensee owners were down by one each, including Capstone, Diverger, Shartru and WT Financial Group. One licensee that ceased also only had one adviser.
Four licensee owners were down by net -2 advisers each, including AMP Group which appointed one and lost two, and Fiducian which hired a new entrant but lost three advisers.
