MLC CEO Geoff Lloyd

MLC today announced a ‘blueprint for advice’ that involves a consolidation of the Garvan, Apogee and Meritum brands, as well as the separation of licensee Godfrey Pembroke which will continue as a standalone high-net-worth dealer group.

Segmentation and consolidation are key themes for CEO Geoff Lloyd, who tells Professional Planner the changes are aimed at fortifying the MLC Wealth brand in readiness for its separation from NAB, which was put on hold in February.

“It’s all about strengthening MLC and repositioning it for the future,” Lloyd says.

Godfrey Pembroke (GPL) – which Lloyd calls “an iconic Australian dealer group” – will continue as a separate licensee operator in an effort to ringfence the brand and its wealthy client base.

“We want to recognise and honour the Godfrey Pembroke current client proposition and segment and protect it,” Lloyd reveals, adding that MLC wants to give the brand “more focus”.

The average balance of clients within GPL licensed firms is approximately $2 million. In March, GPL had 123 advisers under license.

The other end of the restructure involves the consolidation of what Lloyd calls “three similar offers” from Garvan (GWM Adviser Services), Apogee Financial Planning and Meritum Financial Group. Combined, the three dealer groups represented 655 advisers on ASIC’s register in March.

The three dealer groups will operate under the existing GWM Adviser Services license (GWMAS), but the consolidated dealer group will take a new name.

“GWMAS is the licensee we have there today, but we want to create a new brand which recognises the three of them coming together,” Lloyd says, adding that he wants to ensure the “connection” between the groups is maintained.

Employed NAB Financial Planners will also come under the yet-to-be-named licensee, Lloyd reveals. “So, we basically take five licensees into two,” he says.

Less advisers, new fee structure

MLC announced a raft of other changes in its release, including the closure of its self-employed NAB Financial Planning and MLC Advice Stores, which Lloyd estimates should impact “about 30” advisers.

“We’ll work with those and their operations now to either move them to their own license or help them merge with the other self-employed licensees we have,” Lloyd explains. “Some of them might become employees as well.”

MLC is also changing the way it charges for licensing, with an unbundled support and fee structure model providing a ‘core’ offer supplemented by specialist professional services that are charged individually.

“You get to choose from an unbundled list of services,” Lloyd explains, before adding that fees will increase which will help MLC invest into the core offering.

Lloyd says part of the plan is to reduce the number of locations in the planning network, with the bank planning teams being brought into the MLC Advice centres.

“We’re working through the actual numbers there but it is a more focused segmented offer which has a reduction of numbers and locations,” he says.

‘Real time and care’

The ‘blueprint for advice’ is the first of four initiatives MLC announced as part of its licensee review in March. As Lloyd explained then, the review involves structural changes to advice, platform, retirement & investment solutions and asset management.

“This is the first one to be announced,” Lloyd says.

He explains the group wanted to take “real time and care” in understanding the client’s needs and preferences. Being open and transparent with both employed and self-employed planners as much as possible was part of the mandate.

“We surveyed and spent time with about 800 clients, 40 practices and all the advice boards on many occasions,” Lloyd says. “The outcome of that is what we’ve announced today – a simpler, more focused and sustainable advice business.”

Tahn Sharpe is a Sydney-based financial services journalist with a background in financial planning. He writes on advice, superannuation, investment, banking and insurance issues, is a certified SMSF Adviser and holds an Advanced Diploma of Financial Planning. Contact at
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