New financial year promising for adviser numbers

According to Wealth Data, the new financial year has kicked off with an appointment spike in the advice industry.

Namely, the number of advisers has edged up slightly to 16,406 as of 7 July, following 117 appointments and 115 losses.  

Wealth Data’s Colin Williams explained that the gains can be attributed to the return of advisers who had previously left the Financial Adviser Register (FAR).

“We still saw a lot of resignations put into the last financial year and pretty much all appointments into this financial year - hence the new financial year is showing very strong growth of 129 advisers,” Mr Williams explained.

And, while last financial year is currently showing a net loss of 2,671 advisers, the week to 7 July was “one of the strongest weeks of appointments recorded for a long while”.

Namely, 51 licensee owners recoded net growth of 117 advisers.

Notable growth came from Count, which was up by seven, Clime and Diverger.

AMP Group topped the losses for the week, down 22 advisers, followed by Insignia down 13 and MTIS down 7 after selling and switching all advisers to Clime.

A total of 10 licensees effectively closed, including Infinity Capital (-33), owned by Viridian who ‘switched’ most of its advisers into their main licensee.

“As a result of the flurry of movement around the end and start of the financial year, the calendar YTD data makes for interesting reading,” Mr Williams said.

“While we still expect to see some further reporting that may be backdated, the new financial year has got off to a positive start, up +129, compared to +96 for the same period last year,” he concluded.

Late last month, ClearView managing director Simon Swanson boldly predicted that the number of advisers will increase significantly over the next 10 to 15 years.

Appearing on an episode of the ifa Show podcast, the financial services company head said he has high hopes for the industry based on a demand and supply thought process.

Mr Swanson addressed the declining number of advisers when asked about his expectations for December’s Quality of Advice Review (QAR).

“I've always been a demand-and-supply person, right? And the issues in the life insurance industry, to be frank, are a classic case. There is demand for life insurance,” Mr Swanson said.

“Our survey done two years ago said that actually the increasing demand for life insurance in Australia, there's been a supply problem. And the supply problem has been a manufacturing problem and an advice problem.

“Clearly, if you have good demand for a product, eventually, that supply will actually be resolved and that's going to be resolved by having more financial planners. So while we've gone down from, let's say 22,000 financial planners, and we may go down to 12,000, I think it's actually going to go back to about 25,000 planners in the next 10 to 15 years, on a straight demand-supply issue.”