ifa reported last week that CBA subsidiary Bankwest is in the process of closing its salaried advice division, with advisers being given the option to move across other CBA licensees.
Responding to the news, Mr Bristow said this move is “an emerging trend within institutional licensees”.
“It seems to us like the institutions want to either go direct-to-consumers or move solely to salaried advice models in order to have more control over their risks and margins,” he said.
“This is a real shame as these decisions appear to be being made without taking into account feedback from advisers or clients.”
Mr Bristow said this trend is unfairly forcing advisers to restructure their businesses.
“There are many, many fantastic advisers around the country giving great advice to their clients who, through no fault of their own, will be forced to restructure their businesses as the institutions unilaterally make decisions that impact their livelihoods,” he said.
“We believe the clock is ticking on some of the larger AFSLs currently within institutional ownership. It’s only a matter of time before these are either sold or closed down.
“Advisers in these cases will be left with no choice but to move to a salaried model within an internal AFSL of that institution or find a new home within a quality AFSL if they want to remain non-aligned.”
It’s crystal clear, the cost of compliance with its ridiculously onerous SOA regime and kyc pathetic tit for tat nonsense along with the risk of litigation is making this industry unprofitable and financially a disaster for institutions. If your an IFA, you better pray there are still some fools left who will buy your client base. You wouldn’t wish this business model on anyone. Just imagine someone pitching the financial planning model on Sharktank as a business to invest in. Seriously, stand back and weigh everything up. You wouldn’t touch this business with a barge pole. Cba knows it, BankWest knows it and no amount of passionate motherhood statements on service will solve it. The FP business is a disaster and not viable to invest in anymore.
Hmm, Rod, when did any bank care about what advisers and clients want – all they care about is profits and margins – they are a bank.
You are spot on about the concern about fantastic advisers who are going to have their livelihoods CONTINUALLY impacted if they decide to continue to be aligned to a bank.
Easy solution – move to a non-aligned AFSL. So simple. So obvious. We all want security for our futures – best way to secure your future is to become independent (or independently owned). Take control of your own future rather than be at the mercy of these clowns.
The Institutions are driving LIF, through buying of Dealerships they have picked up huge advisor numbers along with a massive share of the market. then of course has come the need to make more profit, with the easy target being advisers commissions.
Does anyone know all the dealership names and each ones adviser numbers owned by the 4 banks? That would be interesting.
Oh so true
The sad thing is many of these clients won’t get the service they are used to and will walk. What happen to the days when the clients needs are put first!
What these institutions don’t take into account is the extreme disruption that it will cause the adviser and their clients. It is all about the Institution and their bottom line. Adviser loyalty is not even considered.
This is the problem. There are some fantastic Advisors out there, honest, factual and not in it to see how much they can get out of the unsuspecting customer, however it is the minority that have not regard for the law or legislation that cause all these issues for the honest advisor.
Very valid viewpoint Rod – thanks for raising this.