‘Major loss’: EOFY prompts adviser exodus

Wealth Data analysis has found a net loss of 81 advisers over the week ending 27 June, dragging the wider profession down to 15,508 advisers in the final week of FY2024.

This figure is 10 times greater than the net decline of eight advisers observed in the week prior.

The significant loss this week is nearly double the decline seen in the last week of FY23 – a loss of 46 advisers.

Wealth Data founder Colin Williams previously forecast high volatility in adviser numbers during the run-up to the end of the financial year as many look to switch licensees but admitted he was “surprised” by the size of this week’s numbers.

“As we get near to closing out the financial year, we suffered a major loss of advisers off the ASIC Financial Advisers Register (FAR).

“It may well be that many advisers are in the process of switching licensees. However, switching this late into the financial year tends to occur on the last working day of June (the adviser ceases), and then appointed at the new licensee on the first working day of July.

“Therefore, the numbers this week were a bit of a surprise.”

Next week, it is expected to see greater volatility as the movement of advisers over 30 June and 1 July will be captured in the Australian Securities and Investments Commission’s (ASIC) data.

Despite the heavy declines this week, the founder noted the negative numbers are being driven by a small sector of the adviser market.

Examining adviser losses this financial year to date, the greatest declines are seen in the accounting (limited advice) model at -82 advisers. Licensees in this model restrict the majority of their advisers to self-managed super fund (SMSF) advice, meaning no investment advice.

The superannuation fund model has also seen a decrease of 50 advisers. Meanwhile, the largest advice models – financial planning and investment advice – are all in the positive.

Weekly numbers

There were no new entrants this week, while 110 advisers were active with appointments and resignations.

Just 12 licensee owners had net gains of 14 advisers in total. Canaccord Group was the only licensee to have a net growth greater than one adviser. The firm appointed three advisers, as two moved across from Macquarie and one from Morgan Stanley.

Some 11 licensee owners were up by net one adviser each, including Fortnum, Findex, and a new licensee.

In terms of adviser losses, 38 licensee owners had net losses of 95 advisers in total. Australian Retirement Trust (ART) saw the highest loss with a decline of 20 advisers despite enjoying the largest gain last week of six advisers, tallying with Williams’ earlier remarks about super fund exits.

“ART advisers that ceased were not ‘member facing’ and are still employed by ART. The changes reflect the strategic repositioning of advice delivery at ART,” Williams said.

Count also suffered a double-digit loss of 11 advisers, including two non-adviser staff members on the Count licensee and nine advisers from Merit Wealth.

Both Sequoia Group and AVALONfs lost six advisers respectively, while Centrepoint Alliance was down by four advisers after it hired one from RI Advice and bid farewell to five.

Four licensees declined by three advisers each, such as Insignia Financial, and seven licensees lost two each, including AMP Group and WT Financial Group. A tail of 22 licensee owners dropped by one adviser each.