Adviser-owned Australian Financial Services Group (AFS) is thriving at the expense of its profit greedy institutionally-backed peers, its chief said.
AFS has reached the milestone of more than 200 financial advisers and 100 practices. It has recruited 16 practices in 2007.
“The more recent successes are primarily because of what [other dealer groups] are doing,” AFS chief executive Peter Daly Daly told InvestorDaily.
“Without naming names, they are to be particular, the institutionally-driven dealer groups that appear to be driving a profit agenda for themselves at the expense of their practices.”
He said planners are fed up of dealerships that restrict their approved product lists, platform use and preferred underwriters in order to negotiate higher rebates.
“There’s a significant degree of dissatisfaction. Advisers are alarmed at the encroachment of dealer groups on their practice. Most of them feel betrayed,” Daly said.
Institutional mergers and acquisitions results in practices feeling the pinch so the dealer group provides a good rate of return, he said.
With Daly at the helm, AFS succeeded in achieving profit, buying out shareholder Zurich’s 39.7 per cent stake and consolidating its profit. The group is gearing up for an initial public offering.
AFS is ploughing ahead with realising expansion through acquisition and recruitment.
“AFS recruiting growth will continue at a steady pace for the remainder of the year, however, we carefully target and seek advisers and practices that will fit into the entrepreneurial culture of the group,” Daly said.
