Dealer group buys back insto stake

Dealer group buys back insto stake

Increasing consumer demand for independently-owned financial planning has driven one licensee to extract itself from a 20 per cent institutional ownership arrangement.

Sydney-based dealer group Fortnum Financial Advisers has announced it is purchasing the 20 per cent stake in its business currently owned by ANZ Banking Group, as a result of a legacy investment by ING Australia, prior to its acquisition by OnePath.

Fortnum executive chairman Ray Miles told ifa yesterday that a desire to be described as an “independently-owned” firm largely drove the decision to free the licensee of institutional ownership.

“ANZ and OnePath have been a good partner and we have a good relationship with them, but being at 20 per cent is neither here nor there,” Mr Miles said. “It’s a nuisance for both of us and didn’t make sense. It was preventing us from being called independently-owned.”

More broadly. the dealer group boss anticipated a shift in consumer demand for independent financial advice, which he says gives a non-aligned advice business a “strategic advantage”.

“The Australian public are looking for places they can go for non-conflicted financial advice and finding it pretty difficult,” he said.

“We have been through this stage of consolidation, but I don’t think that’s relevant now. I think there are a lot of people sitting [on institutionally-owned licences] that wish they hadn’t joined.

“We will now go through a period of deconsolidation.”

The announcement comes despite research released by Roy Morgan in mid-2013 suggesting consumers are confused about the levels of institutional ownership of financial planning groups.

Dealer group buys back insto stake
ifa logo
promoted stories

SUBSCRIBE TO THE IFA DAILY BULLETIN

News

Business Strategy