Insignia Financial has reported that there were 1,600 advisers in its network as of 30 June, a reduction of 82 advisers compared to the previous quarter.
In a quarterly business update released on Monday, Insignia stated that the fall was partly driven by the integration of MLC Advice into Bridges, which it said resulted in the departure of 30 advisers but no impact on client numbers or revenue.
The firm also confirmed the departure of 43 advisers from the self-employed channel, typically from smaller practices, as well as nine advisers from the self-licensed channel.
“There continued to be some shifts in the self-employed channel as Insignia Financial progresses the sustainability of the Advice business, with a number of practices opting to sell their client books or transition to a self-licensed model,” Insignia said.
“As part of its proposition to self-employed advisers, Insignia Financial was able to broker a number of internal M&A transactions retaining a significant proportion of the sold client books with pre-existing practices in the Insignia Financial licensees.”
Insignia noted that it had seen a “stabilisation in the level of departures” since the start of the current financial year and suggested that departures would continue to moderate moving ahead.
The wealth giant also reported a reduction in adviser numbers in its March 2022 quarterly results.
Total funds under administration of $205.2 billion were reported for the June quarter, down 6.9 per cent on the previous quarter, with positive net flows of $592 million offset by market decline of $14.9 billion and pension payments of $793 million.
Additionally, funds under management was down 4.7 per cent to $92.3 billion after market decline of $3.8 billion and institutional outflows of $901 million, which offset positive retail net inflows of $118 million.
“Insignia Financial has again delivered an improvement in platform flows, while facing into increased investment market volatility. Underpinning this growth momentum are client wins in Workplace Super and positive engagement within the Advisory channel,” commented Insignia Financial CEO Renato Mota.
“Flows into MLC’s retail asset management offering were once again positive, offset by outflows from the institutional channel which are typically lumpier in nature. The integration of MLC Advice into Bridges provides a strong foundation for profitable growth in Advice and provides Insignia Financial with two flagship market positions in Shadforth and Bridges.”
Continue to bleed and they will keep rolling out with the same excuses.
But, I have also now noticed that the MLC business (Wrap & Navigator) is now being massively effected on the ground and has impacted my practice. I am now in the process of slowly moving away at reviews to better Wrap account solutions for my clients, about $60 mil exposure. I know that due to “IOOF” buying it that it will only get worse as time goes by.
At what point are people going to wake up to the impending train wreck / titanic situation that is Insignia?
Meanwhile, the share price continues to slide
yet the dividend yield remains good
Over the last 12 months, you got a 23 cent dividend, but you scored a $1.30 capital loss, so overall return has been terrible. Also, since Renato took over in June 2019, the share price has fallen from $5.30 to around $2.90 now.
No surprises here. Its a terrible home for advisers and seems to be the only player left clinging to vertical integration. Can only see more waking up and heading for the exit door.
Vertical integration is still very prevalent. It’s just more dispersed and better disguised these days. Dealer group aligned managed accounts is the new vertical integration.
Very much so …. ask all those employed Bridges/MLC advisers how they are “encouraged” to put every client into one of their internal multi-manager funds; and yet Bridges was known for its strong direct share models once upon a time. Obviously IOOF don’t generate sufficient income from direct share portfolios
Vertical integration is still around us everywhere sadly, Insignia is by no means alone or the last. It will be here until advisers can easily have their own individual licence and it is affordable dollar-wise, time-wise and compliance-wise to do so – jut like other professions. The bloodsucking master agents of the past and the current large AFSLs into which they morphed need to be outlawed for this to happen. Easy individual licencing and accountability is the only true professional way forward. It is the Titanic and deck chairs otherwise. We can only dream on . . . .