Succession planning top concern for non-bank advisers
Succession planning is the number one concern for financial advisers in ANZ's non-bank channels, according to ANZ general manager, advice and distribution Paul Barrett.
One of the key ingredients in any succession planning scenario was having a funding source, and ANZ was fortunate in that it had access to funding, he said.
Barrett identified the bank channel as the likeliest sector to experience short-term growth across the ANZ businesses -purely because it was coming from a lower base.
"Because bank-based channels are quite small by comparison in terms of adviser numbers and number of outlets and coming off a lower base … your internal bank-based channels grow faster," he said.
Barrett said Future of Financial Advice (FOFA) reforms were likely to put downward pressure on practice values in the short term as traditional subsidy systems like trail commissions and rebates were broken down.
However in the long run FOFA would be likely to inflate practice prices because there would be more quality financial planning firms, he said.
Supply and demand would continue to be a significant factor in terms of practice prices, and FOFA could also dent prices in this way by causing a number of older advisers to move out of the industry, he said.
Advisers are about eight years older than they were when the Financial Services Reform Act was introduced, and Barrett said he had had a few conversations with advisers who weren't sure if they would stay in the industry after FOFA, meaning there will be more sellers on the market.
Barrett said that advisers who didn’t already have a succession plan in place were not necessarily a “dead duck” yet but those who don’t have one in the next year or two probably are.
Recommended for you
A financial advice firm has been penalised $11 million in the Federal Court for providing ‘cookie cutter advice’ to its clients and breaching conflicted remuneration rules.
Insignia Financial has experienced total quarterly net outflows of $1.8 billion as a result of client rebalancing, while its multi-asset flows halved from the prior quarter.
Prime Financial is looking to shed its “sleeping giant” reputation with larger M&A transactions going forward, having agreed to acquire research firm Lincoln Indicators.
An affiliate of Pinnacle Investment Management has expanded its reach with a London office as the fund manager seeks to grow its overseas distribution into the UK and Europe.
