The departure of advisers played a key role in financial planning groups boosting funds under advice (FUA) per adviser amid the market turmoil.
Boutique dealer group Principal Edge’s advisers added an average $17.8 million FUA to their book in the six months to June 30, according to the IFA Dealer Group Survey.
The reason behind the increase was the departure of one of Principal Edge’s six advisers, as the firm’s overall FUA was flat at $534 million.
The Sydney-based dealer group specialises in bespoke financial planning, predominantly to private clients, and corporate employee benefits.
Managing director Bruce Kluk was unavailable for comment.
Advisory firm Portfolio Managers boosted its FUA by $15.4 million for its three advisers in the first half of 2008 after losing one adviser, the second largest gain in the survey.
Superannuation specialist planning group Dixon Advisory registered the third biggest gain – averaging $9.2 million FUA per adviser in the first half. Overall, the Canberra-based firm’s 16 planners manage $2.5 billion for their clients.
Dixon Advisory managing director Alan Dixon says FUA growth was driven by the increasing popularity of self-managed superannuation funds (SMSF).
“Investors are disappointed with returns from retail and industry funds and are moving to SMSFs to achieve greater control of their investment choices,” Dixon says.
“Dixon Advisory offers its clients specialised investment opportunities tailored for these uncertain markets.”
Dixon says he believes the firm’s FUA will grow in the second half of this year amid the market volatility.
“Dixon Advisory is handling a significant number of enquiries from investors dissatisfied with their current financial advisers,” he says.
“Investors are increasing their levels of investigation, looking to partner with reputable firms and to take control of their superannuation strategies and investments.”
St Andrew’s Wealth Management, the Australian financial planning unit owned by Halifax Bank of Scotland (HBOS), registered an $8.7 million gain in FUA per adviser in the first half, the fourth largest gain in the survey.
This was due to its adviser numbers dropping from 42 to 18 during the six months, leaving the remainder to manage $369 million overall.
The dealer group’s FUA was nearly $500 million in the second half of last year.
St Andrew’s Wealth Management’s adviser numbers fell because advisers were transferred to HBOS’s BankWest branches as part of the BankWest Financial Planning rollout earlier this year, a St Andrew’s spokesperson says.
Dealer group Prosperity Advisers had a $6.6 million average FUA increase for its planners, the fifth largest in the first six months.
Prosperity chief executive Allan McKeown says the dealer group lost two advisers in the period and decided to not hire any more in order to increase the firm’s productivity and efficiency.
The dealer group has also had a boost in referrals following the recent merger of its Queensland operations with Cansdale and Co, a Brisbane-based accounting and business advisory firm.
Dealer group RetireInvest had a gain of $6.2 million in FUA per adviser in the first half, coming in at number six.
The ING-owned firm lost two advisers in the first half, reducing its numbers to 214, but overall FUA actually increased to $10.4 billion from $9.15 billion at December 31.
RetireInvest managing director Greg Dunger attributes the gains to the dealer group’s conservative investment strategy, which suits its retired or near-retirement clients.
