In an update to the market on Thursday, IOOF said its advice division had seen $1.3 billion in net outflows over the three months to December as a result of its Advice 2.0 “business transformation”.
This figure did not include $363 million in outflows from IOOF aligned dealer groups to the company’s Alliances business as more of its advisers sought to be self-licensed.
The numbers represent a significant drop from the last quarter of 2019, where IOOF saw $939 million in net inflows to its advice arm.
In the business update, IOOF also flagged it had seen $2.2 billion in net outflows from its investment management business, primarily as the result of “reinvestment simplification into external interest-bearing cash accounts delivering improved client outcomes”. IOOF said the revenue differential as a result of the change was negligible.
Its pensions and investments business, formerly owned by ANZ, saw $625 million in net outflows, while inflows to its portfolio and estate administration business were positive with $40 million coming in over the last quarter of 2020 – although this was a significant drop compared with $360 million that flowed in through the last quarter of 2019.
Despite the disappointing figures, chief executive Renato Mota said IOOF was “making good progress towards the transformation of the business”.
“In particular, we are transforming the advice business through our Advice 2.0 strategy and progressing our platform simplification strategy, while supporting IOOF’s open architecture approach and enabling choice for our clients,” Mr Mota said.
He added that the group was meeting targets to transform its advice business and complete its acquisition of NAB-owned wealth group MLC, which was announced in August last year.
Is it all of the left over Planners at ANZ moving customers to Netwealth now? Sell the book to IOOF and then move the customers out, good bit of business.
The days of clipping the same ticket multiple times, platform kickbacks and conflicted remuneration is over…. More difficult to deliver value to shareholders legitimately. At least the recently departed executive team can now set fire to any share options they may have with confidence ……ha ha ha.
Fairly arrogant and terse response from Renato. Care should be taken with such remarks as he will only alienate good advisers. Regarding his Adviser 2.0 strategy, I am puzzled as I have no idea what it is about what he is trying to achieve. Current strategies currently put in place reflect the IOOF share price.
How many times have you heard…..”I am aligned/ licensed to one of these product manufacturing dealer groups and we have a wide an open APL that dosen’t care about FUM or what product we use”…..followed by the words “I wonder why we have FASEA and over regulation and lack of representation by the FPA”…. Wake up advisers and put your colleges and Australians first, yes pay a little more, and you’ll have to pay for your own marketing but we’d be so much better.
If you become self licensed you’ll probably pay a little less. And won’t have to deal with lowest common denominator compliance bloat.
There will be plenty more outflows in 2021 as all the self-employed Bridges planners are pushed out the door to other Dealergroups by 30th June. Once established in their new dealergroups its only a matter of time before clients best interests dictate where funds need to flow to with new ‘non-aligned’ platforms on their respective APL’s.
haven’t heard that story…IFA ?
It’s true, there is way more to the story then the IFA is printing.
I wonder which platforms are “non aligned” these days?
In theory BT and CFS are now non aligned, given the abandonment of advice by Westpac and CBA. But one of the former non aligned darlings, Hub24, has recently morphed into a vertically integrated advice/product group.
Same with all the FSP planners except for a few who haven’t had their retention benefits stolen. They’ll hang around to grab the cheque
Not a surprise given how IOOF is destroying our Practices.
Don’t worry, MLC is doing the exact same thing. So I’m sure all the incoming advisers and their practices will feel right at home.
Maybe you both should contact AMP Financial Planning and seek licencing through them.
Absolutely agree with your comments.