IOOF and Bendigo pool services

IOOF and Bendigo Bank have drawn up plans for a new financial planning arm for their joint venture, according to IOOF managing director Rob Turner.

Bendigo Bank has a small group of planners trading under the BBS Financial Planners banner and these will be rolled into the new venture.

"Our advisory arm has been struggling to provide the required levels of service to our members as the branch network expands," says Bendigo Bank managing director Rob Hunt.

Turner says the new planning group will result in up to new 20 people joining the group, but emphasised it was a separate business from IOOF's Winchcombe Carson operation.

"We are seeing rapid growth for Winchcombe Carson, however, it may provide the back-office support for the new group which will concentrate on building distribution," he says.

In the last financial year Wincombe Carson reported a profit of $618,000, up 10 per cent on the previous year.

As foreshadowed inMoney Management(February 4), IOOF has sold its building society to Bendigo for $20 million plus 3.7 million ordinary shares in the bank.

This makes IOOF a significant shareholder with 5.9 per cent of the stock.

Under the joint venture, IOOF will also provide wholesale funds management and products through the bank's 85 branch network. IOOF's 17 branch network will be rolled into the bank's chain with some closures expected where there is duplication.

Turner says the joint venture will give the friendly the opportunity to broaden its distribution base in Victoria and, as the Bendigo community banks network expands, interstate. The combined customer base is about 800,000 for the two similar organisations.

"It will also provide banking services for our members," Turner says.

Both parties have said the core business of the two organisations will remain separate and Turner refuted any suggestions of the friendly demutualising.