Weekly Financial Adviser Movement To Sep 2, 2021

This week’s analysis of the ASIC Financial Adviser Register (FAR), shows a decrease of (-44) Adviser Roles moving from 19,369 to 19,325

The number of actual Advisers decreased by (-44) from 19,076 to 19,032

Click Here To Access The Detailed Adviser Dashboards

(See Dashboard 17 for more information to the variation between Adviser Roles and Actual Advisers)

Key Movements This Week:

• 65 Appointments and (-109) Resignations - Net Change in roles of roles and actual advisers (-44)

• 30 Licensee Owners had net gains for 44 roles

• 33 Licensee Owners had net losses for (-88) roles

• 7 Provisional Advisers (PAs) appointed, 3 resigned with 2 being re-appointed as advisers. Currently 128 PA Roles

Growth This Week
At the licensee owner level (Dashboard 1B) Oreana stood out this week with 9 new roles after Catapult Wealth formally moved across from Lonsdale. 6 licensees owners had net growth of 2 advisers including Fortnum recruiting from Charter, SGN Financial with 2 from Astute Wealth (SA) and two new licensees Rockton with ex Affinia advisers and Regal Advice ex Sentry advisers. Thereafter, 23 had net growth of 1 adviser each.

Three new licensees commenced for a total of 5 advisers.

Losses This Week
Losses this week were dominated by two groups, NTAA (SMSF Advisers Network) down (-22) and IOOF down (-21). A gap to AMP at (-5) followed by 3 groups, Affinia, Castleguard (Lifespan) and Count all down by (-3). 4 groups were down (-2) and 23 down (-1).

4 licensees closed for 5 advisers.

Interesting to note that all 22 losses at SMSF Advisers Network, a limited SMSF advice group, are showing that none switched to other licensees and none appeared to have passed the FASEA Exam (as of May*). Whereas IOOF is showing (-25) resignations and of those, 15 have switched in the same time period to alternate licensees and 6 had passed the FASEA Exam (as of May).
*Using 11,000 known FASEA Exam Pass results to May 2021.

Year To Date Data
Oreana are back as the leading growth businesses for groups with 50 or more advisers. (Dashboard 2). They have grown by 28 roles, ahead of a merged Centrepoint / Clearview at 13 and Count at 11.

IOOF and AMP groups still dominate in terms of the number of advisers despite the losses with IOOF at 1,418 and AMP at 1,315. A big gap afterwards to NTAA at 649, Easton at 547 and the merged Centrepoint / Clearview at 515. This top 5 represents 4,444 adviser roles or 23% of all adviser roles.

FASEA Media Release For July Exam Results - What Does It Mean?
A few notes from the latest FASEA Media release announcing the result of the July exam sittings:

• Announced 16,030 advisers have passed so far - I don’t think this is a correct statement as it later states that “….310 are new entrants and may be authorised as a Provisional Financial Adviser”. I take from this that 15,720 advisers have passed and a further 310 people have passed who may proceed to be an adviser. FASEA website highlights that Provisional Advisers need to complete quarter 1 and 2 of their professional year before sitting the exam

• 14,070 are active financial advisers on the ASIC FAR - After a lot of pushing FASEA on the fact that not all advisers who pass the exam are ‘current’ on the FAR they are now recognising this issue. Previously, there seemed to be an automatic assumption that everyone who passed was current on the ASIC FAR

• 18,140 ‘advisers’ have sat the exam - As we know, at least 310 are not advisers either current or ceased. Therefore, some 17, 830 advisers have had a go and to date only 14,070 have passed and hold a current adviser role. This gives a pass rate of adviser passes to being current of 78.9%

• What was not explicitly stated were the pass rates for those re-sitting the exam - The media release did highlight that the the pass rate for July was only 60% out of 1,963 candidates, and for those sitting the exam the first time the pass rate was 69%. - Lets break this down further as it also stated that 30% were re-sitting. This means that out of a total of 1,963 candidates, 589 were re-sitting and only 230 passed or 39%. See charts below. This is a significant fall form the 65% who have re-sat the exam in total.

Breakdown of

FASEA Exam Results

The data shows that only 39% of those re-sitting the FASEA Exam passed.

There are still exam sittings in September and the big one in November whereby anyone willing to have a go can sit as opposed to waiting out three months. And in 2022, advisers who had failed at least twice by Dec 2021 will have an extension of time to September 2022 to pass. Given all of this, it is quite hard to predict the total number of passes and in return the number who advisers that will remain on the FAR.

FASEA state that 18,140 have had a go and one would have to suspect not many more will join this list, i.e. we will be down to mainly re-sits. With some 2,000 advisers passing but not current, this would suggest we will end up with between 15,000 to 16,000 advisers. Note: Currently sitting as 14,070 for those who have passed and current on the FAR.

The bigger issue will be post FASEA Exam. Advisers will continue to leave through natural attrition (retirements, change of career etc) and assuming that there are 16,000 advisers and natural attrition is only 4%, we would need 640 new advisers just to stand still. New incoming advisers are currently very low numbers as stated numerous times in our blogs. And of course, there is the requirement of advisers to hold a degree equivalent by Jan 1, 2026 which will inevitably see a further fall in experienced advisers.

Eventually, licensees and practice owners will have to develop new advisers to make up for the lost nursery of advisers that was once the domain of the banks. Some licensees will give this a go, for example, Infocus just announced that they will support their practices to bring on new advisers for their professional year. Will need to see a lot more join in and develop new talent.

Two Months of Back To Back Growth - Not Quite
Last week we indicated that we were on the cusp of having tow months of back to back growth for the first time since 2018. The drop in advisers this week wiped out the August gains and it is now showing a net (-3) loss for August - so close.

Have a great week - any questions, please call or email using the contact details