Client book sale drought ends

The government’s proposed changes to the FOFA grandfathering provisions have resulted in the return of planning practice and client book listings, according to a business broker.

Financial planning mergers and acquisitions consultant and broker Radar Results has reported that buyers and sellers in the financial planning market are “very happy” about the proposed changes, with nine new practice listings received in February, “virtually ending the drought that started in July”.

A statement from the broker also suggested that “in addition to an influx of new sellers of financial planning practices, we have seen higher demand than usual for mortgage books, forcing prices up. Recently a seller was offered two times the trail”.

As reported by ifa in a recent feature, there are an increasing number of financial advisers interested in expanding their repertoire to mortgage and debt advice, with the alleged spike in mortgage book demand perhaps another example of this trend.

Meanwhile, despite the precarious situation of the corporate super sector outlined by the Corporate Super Specialists Alliance, demand for corporate superannuation specialist practices is on the rise, along with practice values, Radar Results says.

“Corporate superannuation has made a recovery,” the communication stated. “After multiples had dropped to as low as zero, demand has now picked up, and so have prices.

“It really depends on who the fund manager is that's providing the administration service, and which licensee the buyer's with.

“Some licensees are paying their advisers, who are qualified corporate superannuation fund specialists, a flat annual fee per member to continue servicing the plan, even though the commission has been switched off.”

Queensland is the busiest state for practice sales, with 25 practices looking to sell, followed by NSW (24), Victoria (10), WA (8), and one each for Tasmania, the Northern Territory and South Australia.

Client book sale drought ends
ifa logo

The must-attend event for financial advisers is back in 2022: the ESG Summit, coming to Sydney and Melbourne in February. Walk away with vital knowledge on a number of key ESG areas to help you make informed ESG strategy decisions and to better communicate and integrate the growing ESG space to clients. Visit the website to secure your place.

Subscribe to the ifa bulletin

Receive daily online news,analysis, reports and business strategies
By signing up you agree to our Terms of Use and Privacy Policy

Website Notifications

Get notifications in real time and stay up to date with content that matters to you.