Netwealth reports FUA spike, says relationship with new advisers is growing

In an announcement to the ASX on Thursday, Netwealth reported a quarterly FUA spike of $6.7 billion to $84.7 billion as of 31 March, comprising net inflows of $2.7 billion and positive market movement of $4 billion.

For the 12 months to 31 March, FUA added 28.5 per cent or $18.8 billion, comprising FUA net inflows of $10.6 billion and positive market movement of $8.2 billion.

“We are expecting the June quarter FUA inflows to be very strong with several new large transitions commencing, in addition to higher seasonal flows and increased market activity,” Netwealth said.

Funds under management stood at $19.7 billion at 31 March, up $1.6 billion for the quarter, while managed account balance increased by $1.4 billion to $17.0 billion including net inflows of $0.6 billion.

During the quarter, the firm said it also “expanded and strengthened” its new adviser and licensee relationships, without elaborating further.

The firm also announced it is “actively” exploring and implementing innovations in generative artificial intelligence to improve efficiency, productivity, client engagement, and service.

Late last year, Netwealth’s AdviceTech Report revealed almost half of advice businesses are exploring AI’s potential.

“Financial advice experts in our survey believe technology will lead to significant leaps in how they do business over the next five years,” the report said.

“And what technology do they think will deliver on this promise? Fifty per cent of advice firms say AI – jumping from 25 per cent the previous year – the largest increase of all advicetechs.”

However, despite this strong indication, AI is still not widely adopted across the financial advice industry. The report found that just 11 per cent of advice firms have piloted or are implementing AI in limited use cases, with another third (34 per cent) exploring its potential.

“However, this suggests almost half of all advice firms are ‘AI interested’,” Netwealth said.

“Of the AI-interested advice firms, 65 per cent anticipate increasing their AI spend in the coming year.”

Also on Thursday, Netwealth said its founder and major shareholder, Michael Heine, has advised that as he approaches his 75th birthday, he intends to transition to non-executive director by 30 June 2024.