Micro-AFSLs claim market share from largest players
Growth in micro-AFSLs has had a hit to the largest players with Insignia and AMP both seeing a drop in their market share.
According to research by Wealth Data, Insignia and AMP were the two largest players in the financial planning model market.
However, the market share of Insignia had fallen from 14.09% on 1 January, 2022 to 10% as at 23 February, 2023 and from 11.68% to 8.76% for AMP.
Looking at their total market share across all types of advisers, Insignia had fallen from 8.78% to 6.66% while AMP had fallen from 7.28% to 5.83%.
The next-largest financial planning firm was Centrepoint which reported 4% growth over the period, growing by 21 advisers compared to losses of 754 at Insignia and 576 at AMP.
Wealth Data founder, Colin Williams, said: “The change in market share for the larger groups has been affected by the growth of new ‘micro’ AFSLs. Since 1 Jan, 2021, 250 new AFSLs have commenced in the Financial Planning model, all but one has less than 20 advisers. 140 have closed.
“It should be recognised that some of the groups still service advisers who may have switched into a small AFSL of their own. However, it clearly highlights how the overall market has become far more fragmented than it once was.”
Looking at weekly data, Williams said there had been a net change of five advisers in the week to 23 February with 21 licensee owners having net gains of 31 advisers and 23 licensee owners having net losses of 34 advisers.
Five new licensees commenced and seven provisional advisers commenced while one of each ceased during the week.
One licensee commenced with three advisers from Charter (AMP) and two commenced with two advisers from Lonsdale (Insignia). Four licensee owners were up by two including Highfield Group, Fiducian and Diverger while there was a tail of 13 licensee owners with one new adviser.
Losses were seen at Insignia, which lost six advisers who left to start their own AFSLs, AMP lost seven and Lifesherpa Holdings lost two. Some 19 licensees were down by one each including MCA Financial Planning, Fortnum and Viridian.
Williams said: “A relatively quiet week with 66 advisers joining/leaving licensees. However, a jump of five new licensees highlights there are still ‘practices’ out there in large groups looking to take greater control over their business”.
AUTHOR
Laura Dew
Recommended for you
With Sanlam Private Wealth coming under ASIC pressure regarding the number of responsible managers in its business, law firm Holley Nethercote explores what the role entails and how to stay on the right side of the law.
Insignia Financial has granted CC Capital access to select company information in the hope of securing an improved offer from the private equity firm.
Recruitment agency Robert Walters has revealed the expected salary ranges for Australian financial advisers in 2025, with one particular state seeing a decline.
As global PE firms scope out the Australian wealth management industry, Finura predicts which other local names may potentially receive a takeover offer this year.
