IOOF chief of advice Darren Whereat

The chief of advice at IOOF, Darren Whereat, says the firm is quite content to operate with several different licensee models as it gives them an opportunity to cover different segments of the advice market and bring services to more Australians.

Speaking to Professional Planner, Whereat explains that the 1400-strong network comprises a mix of fully employed advisers, the traditional self-employed advisers operating under a partnership model, and advisers operating under a ‘dealer-to-dealer’ model where the AFSL sits with the client but they still purchase business services.

“If you want to be an advice-led business you can’t just lead in one segment,” Whereat says. “You need different devices for different models for different needs.”

According to Whereat, who came to IOOF from ANZ subsequent to the firm’s purchase of the bank’s wealth arm in 2018, all of the models have a place in the advice ecosystem and each has its own merits. Advisers want to operate under different models, so it makes sense that a large dealer group would provide those options.

“We’re comfortable with the multiple of brands we’ve got,” Whereat says. “At the moment they all have value propositions that cover different segments of the community.”

The IOOF executive is due to speak at the Professional Planner Digital Licensee Summit on June 2. To register, book here.

The slimmed down version

There are ten licensees currently owned by IOOF Holdings, seven of them with over 150 advisers.

Millennium 3, Consultum, Financial Service Partners and RI Advice operate under a self-employed partnership model and represent 832 advisers. Shadforth Financial Group’s 154 advisers are all employed by IOOF while the 182 licensed by Bridges are a mix of employed and self-employed. The 198 advisers linked to Lonsdale are licensed under a mix of self-employed and dealer to dealer models.

It may seem convoluted, but this is actually the slimmed down version of IOOF after it sold Ord Minnett in mid-2019 for $115 million and then announced the shutdown of it Elders Financial Planning network.

A nice balance

The listed wealth manager’s chief executive, Renato Mota, indicated in August last year that the group may look to favour salaried advisers in the future. As per Professional Planner’s Matthew Smith, Mota described a private practice advisory business which is “corporatised in nature” with healthier earnings margins.

While the acquisitions of Bendigo Bank’s and IMB Bank’s advice businesses added employed advisers and supported this notion, Whereat says this doesn’t mean the firm is set on converting their workforce to salaried advisers.

“We believe a successful advice-led business for IOOF will need to have each of those channels,” he explains. “It’s not one or the other.”

Whereat says the business is quite happy to keep all three models on equal footing.

“A nice balance for us would be to have a third in each, but we’re not working to targets or favouring either model,” he says.

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 tahn.sharpe@conexusfinancial.com.au
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