There will be no “direct competition” between AMP and AXA financial planners following the merger of both businesses, according to Craig Meller, managing director of AMP Financial Services.
“If we talk about financial advice, I think it’s true for the AMP business separately, the AXA business separately and both businesses together today, the big issue in Australia is the supply shortage of quality financial advice,” he says.
“So we rarely see financial planners competing with one another [because] frankly, there aren’t enough financial planners around to serve the market.
“So in the advice space we see very little, what I call, direct competition because it’s such a big market opportunity.”
Meller says the merged business will continue to actively seek new advisers and focus on adding value “to the AXA side, helping them grow business as high quality financial advisers”.
“We haven’t changed the terms and conditions of any of the financial advisers in any of the AXA licensees or the AMP licensees,” Meller says.
“Within AMP, approximately half the advisers who join in any year would be coming from the Horizons Academy. We’ve already had one of the graduates from Horizons Academy agree to sign up to join an AXA practice rather than an AMP practice. And that’s an area we think we’re going to be able to help the AXA planners grow their businesses much more into the future.
“The other half typically would be AMP working with financial planners to recruit them from other areas. They come from a number of sources but many of them are already working as financial planners with our competitors.
“We think the combined group is going to have a unique proposition because the core of what we do is providing quality financial advice. It’s what we’re focused on and that’s very different to our major competitors.
“I think financial planners will begin to see that there’s a core difference between AMP and the other big players in Australia.”
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In response to the potential of adviser poaching by competitors and whether AMP and AXA’s adviser numbers are declining, Meller says “there’s a lot of noise in the marketplace”.
“Planners leave AMP and AXA in the ordinary course of our business and the majority of planners who have left both businesses so far this year are people who have actually gone on to retire,” he says.
“But there’s always a small number of planners moving from AMP out, from AXA out but also from the competition into AMP and AXA.
“And I’d describe the market environment at the moment as noisy but the movement is certainly well within what we’d call ordinary movement in the course of an ordinary year.”
During the planning phase of the merger, AMP will continue its multi-brand approach to financial advice and maintain both the North and the AMP Flexible super offers in the retail investment, superannuation and retirement markets.
In the corporate superannuation market, AMP Flexible will be the offer for small to medium businesses, while SignatureSuper continues as the offer for medium and large corporates.
Meller says after looking at the offers that are available to the two different groups, “there are a number of aspects of those offers which is very easy for us to make available from the AXA side to the AMP side or the AMP side to the AXA side”.
“We believe there are a number of complementary aspects of the AMP and the AXA product sets, which will allow us to create a combined suite of products that’s broader and more competitive than either company’s current product sets.
“Our primary focus remains on maintaining the momentum of both businesses during this process.”
