Clock ticking on insto licensees: Infocus
There is an emerging trend within major institutional licensees to either go direct to customers or move solely to a salaried advice model in order to have more control over their risks and margins, according to Infocus Group managing director, Rod Bristow.
Further, he believes that the clock was ticking on some of the larger licensees within institutional ownership because "it is only a matter of time before these are either sold or closed down".
Referencing the recent decision taken by BankWest to close its salaried advice division and the earlier decision by Suncorp to exit its advice business, he said such moves were a real shame because the decisions appeared to be being made without taking account of feedback from advisers or their clients.
"There are many, many fantastic advisers around the country giving great advice to their clients who, through no fault of their own, will be forced to restructure their businesses as the institutions unilaterally make decisions that impact their livelihoods."
"We believe the clock is ticking on some of the larger AFSLs [Australian financial services licences) currently within institutional ownership. It's only a matter of time before these are either sold or closed down. Advisers in these cases will be left with no choice but to move to a salaried model within an internal AFSL of that institution, or find a new home with a quality AFSL if they want to remain non-aligned," Bristow said. Pointing to the Infocus strategy, he said the firm did not believe the industry's focus on adviser numbers as a success metric was the right one.
"Taking into account a more balanced or risk-weighted view of business is really important to Infocus. We want to ensure we're working with qualified, experienced and culturally aligned advisers who if not already, will become the future leaders of the industry", he said.
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