Renato Mota

With a consolidated network of fewer, yet larger dealer groups, Insignia has dubbed the re-shaping of its wealth arm as the “corporatisation of financial advice”, while also revealing a figure of $463,000 revenue per adviser in its 1H22 results.

It’s the first results report under the new Insignia brand and the first time it has openly stated revenue generated by each adviser.

The group’s strategy to streamline its business as part of its Advice 2.0 model has led to smaller practices unsuited to Insignia’s model leaving, although the group noted some smaller practices banded together.

Speaking to Professional Planner shortly after the group’s H122 results call, Insignia chief executive Ronato Mota called this the “corporatisation of financial advice”.

“There’s no doubt as part of Advice 2.0 that some smaller practices have departed,” Mota said. “We are having fewer firms that are larger, so [the advice practices] are more corporatised.”

Insignia’s view is far from unique in the industry, with the expectation that efficiencies from large scale businesses will generate better profit margins.

However, Mota maintained this direction is a positive for advisers and clients.

“With larger practices you can actually put the infrastructure and technology in place to create efficiencies that are required to ensure the advice is high quality,” Mota said.

“The real positive is we’re committed to making sure we invest in technology to continue to support advisers and we’re there to help support that growth.”

Insignia had 1,765 advisers at the end of 1H22 – up from the 1,167 recorded on Professional Planner’s 2021 licensee owners list.

This included over 400 advisers from its acquisition of MLC Advice that was completed last year.

Overall, the group is in steady shape financially reporting a 79 per cent increase in underlying net profit after tax.

The firm is also on-track to break even on its ex-ANZ aligned licensees by end of FY22 and MLC Advice by FY24.

The ex-ANZ aligned licensees improvement is attributed to its revised fee model and a contraction in adviser numbers to improve practice sustainability.