NAB confirmed yesterday the sale of its wealth management businesses under the MLC brand by the end of the 2019 calendar year.
The news was broken to aligned advisers in an email from NAB general manager for advice Ross Barnwell, obtained by ifa.
In the email, Mr Barnwell said the businesses – including MLC Financial Planning, Apogee, Garvan Godfrey Pembroke and Meritum – would be part of an “independently owned wealth management business”.
“It’s expected there will be ongoing arrangements between NAB and the independently owned wealth business to offer NAB customers continued access to advice and products to meet their wealth management needs,” Mr Barnwell said in the email.
“The design of the ongoing relationship model is a key focus as we prepare for the separation of the businesses,” he said.
Mr Barnwell also provided NAB-aligned advisers with an email template for clients, explaining there would be “no impact on our relationship with your, or on your investments”.
“The teams that manage your MLC investments will be included in the newly independent wealth business and there will be no change to them or their investment processes,” says the letter.
ifa spoke to NAB chief customer officer Andrew Hagger yesterday, asking him specifically about the use of the term ‘independent’ in the communications with advisers.
“What we’ve announced is that a likely pathway is the demerger of MLC which, in turn, will create an ASX100 company which is owned by institutional and retail shareholders in Australia. It will be able to carve its own investment path, and it will clearly be independent,” Mr Hagger said.
Mr Hagger said NAB advisers will no longer have to explain the relationship with MLC to their clients.
“It’s just something that advisers had needed to explain. And in an independent model, that’s not something that needs to be explained,” he said.
beg to differ with those who think just b/c the ownership changes this is any different – still have advisers advising on investments in products that are owned by the same ultimate company – doesn’t matter whether it is bank owned or a listed Group – when will we as an industry realise you can’t sell yourself as independent (no matter what the legislative definition) when this vertical integration exists. Stop blaming “the banks” and start looking to our own industry. This doesn’t change any of the issues the RC is raising!
Hello FPA..Your member is breaking the corporations act by using the term independent. Section 923A and also Section 912A…oh wait they pay you money and provide members so nothing will happen…except I guess another Royal commission and I’ll get the blame. Oh Yeah…
Great News, positive for Advisers and staff!! Bring it on!!!
“It’s expected there will be ongoing arrangements between NAB and the independently owned wealth business to offer NAB customers continued access to advice and products to meet their wealth management needs,”
So what actually changes then ??? If that’s what NAB calls ‘independent’ – seriously deluded.
Just imagine what NAB could have achieved if the same level of rigor had been put into actual customer service.
This is fundamentally good news. The banks have never understood wealth and this is potentially the root of many of the problems we are seeing emerge from bank ownership today.[b] It’s Common sense – if you don’t understand or care about a business it will fail. Combine lack of care with a very large institution that struggles to understand what’s going in its own core business and its a recipe for disaster. As for Vertical Integration agree with those saying its not the problem. As long as you have transparency through the whole value stream, specifically fees and charges and its clear the advice is in the best interest of investors, why should we be concerned. Agree with industry funds comments and advice. Its vertical integration with NO ADVICE ! What about indusrty funds hiding costs unit prices How can it be argued customers understand this approach, exactly what do they hide in the unit price ? Doesn’t matters the ad campaign is all members need. We are very good at attacking ourselves, lets use some of our energy, industry experience and VOICES to highlight the big issues in industry funds that seem to be overlooked. Australians have been sucked in by long standing marketing campaign that is at best, “dishonest” Will Mr Hayne force hold them to account ? How do we use this opportunity to force this conversation. Lets face it FPA and AFA are not good and haven’t been able top represent. Time for a change in strategy.
Is a tangled web the industry has woven! Manufacture or advise but when they are combined another RC is inevitable down the track.
best of luck to the ‘new’ MLC very sad to watch the demise of this business from a power house to unwanted child !! Only people to blame is the woefully CEO management in recent years , no vision, no understanding and a disdain for advisers !! Chief Customer Officer c’mon please closet these guys ever get to real customers is at a RC !!
Bless these inept Bank Employees, with no advice experience whatsoever or any FP qualifications, who say stupid stuff and think it means something.
Will be much better when FP Advisers get real qualifications so our industry doesn’t look like a joke.
The worst Advisers (including those banned by ASIC) have better FP credentials than the average Bank Employee managing an AFSL.
[b] “It will be able to carve its own investment path, and it will clearly be independent,” Mr Hagger said.[/b][i][/i] He’s broken the corporations law already. He’s clearly implying to those clients of those businesses that it will be independent. I am unable to call myself independent due to trail commission from 5 grandfathered clients and yet he’s already created a false impression by using the words independent. His statement is false, misleading and deceptive. He’s in clear breach of Secton 912 of the corporation act by making this statement.
HA HA Inde what. Someone does not know the rule.
A new listed company offering wealth management products and advice through different dealer groups? Sounds like another AMP to me.
It’s becoming increasingly clear that the banks just have no idea
it all depends on what popular opinion (the public and the government guided by the RC – NOT advisers) believe is a workable model into the future.
ASIC would certainly have a job on its hands if there were no VI and no licensees monitoring 20-25k advisers.
Perhaps the public would be happy enough to see the banks removed from the ‘advice’ equation – this appears to be what everyone is most upset about (the banks)? Of course if VI is to be ended altogether then the Industry Funds will also need to close down their advice channel.
All the peripheral noise like Dover and AMP will go away or be regulated into oblivion, it is the banks that are the heart of the problem for the ideologues.:!:
Um, isn’t using the word ‘independent’ a bit of a jump!! Apart from the fact its a restricted word under s923A!!
Didnt findex get fined for making similar sort of claims?
Scott, totally agree in relation to s923A. Perhaps the press release had not been run by legal department ?
Yes he’s basically breached the corporations act already. Plus they’ve created a false impression that these business Will be independent.. and given those businesses a leg up already compared to other advice firms.. NAB Financial Planning is a member of the FPA and a complaint should be made. They’ve breached section 912A of the corporation act by stating this. Advisers need to send a complaint to 1) the FPA and the AFA and 2) ASIC of course.
the company will just work under a new banner and pay fee’s to NAB for the right to service the clients same same but different.
If the new company still has products and advisers under the same corporate roof, nothing really changes at all. It’s still vertical integration, just with a different owner.
But still the same as AMP, IOOF and ‘independent’ advisers providing white label / in-house products.
But its not though, because those ‘non-aligned’ or actually independent dont financially benefit from the product itself. We have switched our platform multiple times as better and cheaper offerings come out for clients, its easy to do this when you arent incentivised by $$$ to stay with a certain provider…
What incentive does a MLC Aligned dealer group get on products like MLC Wrap or MLC MasterKey Fundamentals? No fees come back to the practice owner apart from ASF and insurance commissions which all pay the same rate? As for the older products licencee standards have us pick them up at review time and compared with 2 outer group products and a newer product? So, in todays day and age.. What monetary benefit does an adviser get for current products?
Why the multiple switch? To rack up more fees for yourself?