The ANZ sale shifted five large dealer groups to IOOF – already the 6th-biggest licensee owner – affecting about 1040 advisers. It is expected to make IOOF the second-largest licensee owner in 2019. ANZ will retain its largest licensee, ANZ Financial Planning, whose 379 advisers would leave it at number 10, based on current data.
NAB’s intent to sell, which the bank’s chief customer officer for consumer banking and wealth, Andrew Hagger, revealed to Professional Planner, has not yet come to fruition. The five NAB licensees on the market – JBWere will be retained by the bank to service its high-net-worth clients – now represent 1315 advisers. If these five remain under the umbrella of unified ownership, they should represent the third-largest licensee group in 2019. There is no certainty of this, however, as at least one large licensee group, Godfrey Pembroke, has indicated a preference for independence.
Dover’s collapse was preceded by a shambolic appearance by the firm’s chief executive, Terry McMaster, at the royal commission. Subsequent pressure from ASIC led McMaster to agree to disband the Dover Group, and he emailed 399 advisers to inform them that no new advice could be given under their current arrangements.
CBA’s demerger announcement came across as a concession in many ways. While Count Financial and Financial Wisdom represent a combined 807 advisers, which would make CFS Group the sixth-largest licensee owner, CBA will retain three licensees representing 750 advisers and remain in the top 10 at seventh, based on current data. The bank’s retreat from wealth management is only a half-step at this stage, and there is no indication that either CBA or the new CFA Group will walk away from vertically integrated models.
The changes are indicative of an industry in the throes of massive upheaval. The bloodletting at the top end, while not without casualties, should serve to flatten out the structure of the licensee industry and make it less top-heavy. The institutions are being supplanted by a burgeoning second tier of large licensee owners, whose own surge is enabling a new breed of mid-sized boutique firms. Beneath them, the self-licensed brigade swells.
It has not come without warning; while the top five licensees remained unchanged from 2017 to 2018, their adviser numbers were down by an average of 13 per cent.
There will be further moves that will shape the licensee space before the 2019 list comes out. The growth of the SMSF Advisers network, which provides scaled licensing solutions to accountants wishing to provide financial advice around self-managed superannuation funds, could lead to it climbing the rankings. The fate of almost 400 ex-Dover advisers could further shake up the list, while the marriage between ANZ and IOOF still needs to be consummated and anything could happen with NAB’s five large licensees.
The list published here merely projects what next year could look like, based on announcements made to date.