{"id":47674,"date":"2020-01-08T14:09:01","date_gmt":"2020-01-08T03:09:01","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=47674"},"modified":"2020-01-15T07:19:13","modified_gmt":"2020-01-14T20:19:13","slug":"3000-adviser-exits-from-major-institutions-new-report","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2020\/01\/08\/3000-adviser-exits-from-major-institutions-new-report\/","title":{"rendered":"3,000+ Adviser Exits From Major Institutions – New Report"},"content":{"rendered":"

Major regulatory action post the Royal Commission, combined with strategic exits by major banks along with a 50 percent increase in exits from major institutions, is transforming the shape of the financial advice industry, according to the 2nd Australian Financial Advice Landscape Report<\/em> by Adviser Ratings.<\/a><\/p>\n

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Adviser Ratings CEO Mark Hoven …the advisor industry is changing in the blink of an eye.<\/figcaption><\/figure>\n

The research firm reports that advisers are voting with their feet, with a 50 percent increase in exits from major institutions and adviser retirements at 18 percent annualised. Its original five-year forecast remains on track for an advice market that will shrink to 15,000 advisers with $900 billion of wealth in transition.<\/p>\n

\u201cThe advice industry is changing shape in the blinking of an eye\u201d, said Adviser Ratings CEO, Mark Hoven,<\/strong> in a media release.<\/p>\n

\u201cThe continued mass migration of advisers in 2019 has been defined by the synchronised withdrawal from advice by the major banks, and AMP rebalancing,\u201d he added.<\/p>\n

To end of November 2019, the research reported 3,100 adviser exits (+50 percent pa) including 1,900 switches (+57 percent pa) out of the Big Six wealth institutions, primarily into privately-owned licensees.<\/p>\n

The report notes that adviser departures remain high with 15 percent of advisers having exited by the end of October, although there was a marked slowdown in Q3 following the government\u2019s announced extensions for advisers to meet FASEA educational standards deadlines.<\/p>\n

\u201cOur latest research provides a much clearer picture of the education gap confronting the advice industry, and it\u2019s not as bad as some of the commentary suggests,\u201d said Hoven. Eighteen percent of advisers already meet the qualification standard while another 42 percent have to complete four subjects only.<\/p>\n

The report also found that adviser revenue is under extraordinary pressure.<\/h6>\n

\u201cShould the government legislate the proposed 2021 \/ 2026 FASEA deadline extensions next year, more advisers may choose to stay and study.\u201d<\/p>\n

The report also found that adviser revenue is under extraordinary pressure with the end to grandfathering by 2021, more staged reductions in life insurance commissions, and other commercial restraints driven by FASEA Code of Ethics reform.<\/p>\n

To reduce the bleeding, advisers are actively responding by:<\/p>\n