The Royal Commission has exposed a litany misconduct that has had a profound impact on advice businesses. Dover’s closure and the rethinking of wealth management business ownership by banks are two major developments that have affected adviser movements.
Industry Outlook
There are around 24.9k advisers on 1 July 2018 which is a 200 drop since 1 April 2018. The drop is due to the number of exiting advisers exceeding the number of new advisers.
There were 544 new advisers in the quarter to July 2018 compared to 846 in the quarter to July 2017. Advisers are likely deterred by the negative public scrutiny of the advice industry while licensees may have pulled back on hiring due to recent uncertainty.
AMP and the large institutions have strong systems in place for attracting new advisers. However, in the quarter to July 2018, AMP attracted 22 advisers compared to 40 advisers in the quarter to July 2017. The other reason for the drop in new advisers compared to same quarter last year is the slowdown in the number of accountants licensed to give advice on SMSF. The SMSF Advisers Network attracted 16 new advisers in the July 2018 quarter compared to 55 in the July 2017 quarter.
The licensees contributing to adviser exits are discussed below.
Top 20 Licensee Rankings
The mix of top licensees has changed dramatically over the quarter to 1 July 2018 as a result of Westpac, NAB, and Count dropping in rankings. The drop is mostly because of advisers exiting Westpac, NAB and Count. GWM has increased its ranking by keeping the number of advisers flat. GPS Wealth has increased the number of advisers from 298 to 310 by new licensing of accountants as well as by attracting advisers from other licensees. GPS Wealth has improved its ranking quickly by growing in a stagnant environment.
The table below shows the number of advisers on 1 April 2018 and 1 July 2018 for the top 10 licensees. Commonwealth FP has also suffered a reduction in the number of advisers due to exits being higher than usual.
Dover
Terry McMaster announced in June that Dover was shutting down, and Dover advisers must find another licensee to continue giving advice1. The shock closure left little time for advisers to find a new licensee.
Access the report below to read more about licensee ranking movements, analysis on aligned to non-aligned adviser movements and education reform impacts.
Licensee Quarterly Insights – July 2018
Leave your details below to access the current edition of Licensee Quarterly Insights Report and receive future updates on new insights from Skilful Analytics.
John Low is Principal of Skilful Analytics, a data analytics consultancy that helps organisations unlock data-driven insights that enhances decision making. Prior to founding Skilful Analytics, John practiced for 18 years as an Actuary applying his analytical skills to life insurance product manufacturing and financial management of life insurance companies. In his free time, John enjoys spending time outdoors with his family as well as running and basketball.
