Even though most of the Dixons Advisory complaints are yet to be submitted, the CSLR has already allocated a $24 million bill to the industry. Good financial advisers will be forced to pay for the nefarious and neglectful acts of bad ones for years to come.
After years of regulatory turmoil and a violently shifting business landscape, the advice industry may be on the cusp of a relatively calm period. For advisers, this could be the right time to reflect, revise and even reset their business.
Adviser numbers swell as Professional Year candidates come through
The number of advisers in the country is starting to grow after the industry reached its nadir in 2022, with a thickening stream of Professional Year candidates coming through the ranks and a reduction in the amount of those looking to depart the sector.
Over the last 12 months the advice industry lost a net total of 348 advisers, yet data from ASIC collated by Wealth Data shows the figure for this calendar year is a net gain of 43 advisers.
The figures are quirky for a few reasons, principal among those the predilection for advisers to leave their jobs either at the end of the financial year, ie June 30, or the end of the calender year. While both these periods are caught in the ‘last calender year’ timeframe, neither fall into the ‘current calendar year’ figures.
Regardless, the numbers do indicate a positive swing in the direction of adviser numbers.
“The worst case scenario is that things have definitely stabilised,” Wealth Data data manager Colin Williams tells The Inside Adviser. “Best case scenario is that we’re seeing some growth.”
The current year figures were even better a month ago, Williams says, when net growth stood at 73 advisers. Why the net figure is down 30 in the last month remains a mystery, he added. “We have seen the growth taper off in the last month or so,” he says. “I’m not sure why, exactly.”
The overall trend, however, is growth in adviser numbers, which currently sit at 15,845. It’s a minor, but significant turnaround in the advice personnel outlook after a bleak few years where the cohort shrunk from almost 30,000 leading into the Hayne Royal Commission.
According to Williams, the amount of advisers coming through the ranks via the Professional Year program is a major driver behind the increase in net advisers, with 136 recorded in the year to date. This is a “significant” increase on 2022, he says, while noting that the figure also includes advisers who have come off ASIC’s register and subsequently re-registered.
Also playing a role in the turnaround is the government’s mooted ‘Experience Pathway, exemption for advisers with 10 year of experience in advice and a clean record, which has encouraged some advisers who otherwise wouldn’t have met the equivalent degree requirement to remain in the industry.
At some point, as well, most of the advisers who have considered leaving the industry have gone and done so.
“Overall, the numbers are definitely a lot more positive than they have been for a long time,” Williams says. “The term ‘green shoots’ is probably a bit over-used but it’s probably appropriate because this year is the first time we’ve seen real growth in a while.”
Licensee shift
At a licensee level, the last 12 months has shown a distinct tightening phase for the nation’s largest advice houses and the growth of small and mid-tier licensees.
According to Wealth Data, which only ranked holistic advice providers and excluded super fund advisers, accountants and stockbrokers (leaving a quantum of 10,565 instead of 15,845), institutional providers AMP Group and Insignia Financial lost 158 and 122 advisers respectively. WT Financial Group, which bought insurance advice group Synchron in March 2022, lost 101 advisers.
The list of licensee groups that gained the most advisers was much flatter, with MBS Advice License bringing on 18 and PSK Group experiencing a net gain of 17 advisers. While these groups are relatively small with 18 and 84 advisers respectively, the next biggest gain went to a solid mid-tier licensee group in Fortnum Financial, which took on 15 advisers to total 228.
