Top institutional dealer groups biased to owners' super products: Roy Morgan
The six largest institutionally-owned dealer groups place an average 73 per cent of their clients’ super products with their own parent company, with the top three placing more than 80 per cent, according to Roy Morgan research.
Its 2009 Superannuation and Wealth Management in Australia report also revealed there had been no real change to this average over the last three years of the survey.
“Consistently over the three years, these dealer have been allocating an average over 70 per cent of their sales to their own products, and in the last 12 months to June this year this figure is 73 per cent,” the report said.
The dealer groups directing the highest volume of super products to their own products (tied fund managers) were found to be AMP (82 per cent), AXA (82 per cent) and Westpac/BT (80 per cent).
CBA/CFS placed 72 per cent of clients' products with their own company and NAB/MLC 64 per cent for 2009.
The report singles out the ANZ/ING planning group as being the least likely among the top six over the past thee years to direct their clients to its own products.
In the 12 months to June this year the report found only 38 per cent of ANZ/ING clients ended up with ANZ/ING products.
The Roy Morgan report also found there is still significant confusion among consumers as to what 'independent' means in terms of financial planners, particularly if the brand is different to the owner.
For clients of planners working for NAB, CBA, Westpac and ANZ, there appears to be a “reasonable understanding” that they are tied, but those with AMP, MLC, Colonial and AXA have a “degree of confusion” over the issue.
It found this confusion is particularly apparent where the branding is different to that of the owner.
The report found 48 per cent of clients of Hillross planners think the dealer group is independent, 59 per cent of Garvan's clients, 56 per cent of Godfrey Pembroke's clients and 49 per cent of RetireInvest's clients.
Even when the planner comes directly from a major fund manager there is confusion over the issue of independence, it found.
For example, 28 per cent of clients using the AMP group think the planner is independent, and this is even after they end up with AMP's own products, while 31 per cent of AXA's customers think their adviser is independent, it found.
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