Sharp drop in Australian adviser numbers: report

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Sharp drop in Australian adviser numbers: report

Australia saw an 'exodus' of financial advisers from the profession in 2019, with adviser numbers falling to four-year lows, according to data published yesterday.

The report, published by Adviser Ratings, shows 4,378 left the profession in 2019, with 1,133 leaving in in 4Q2019 alone. The total number of active advisers at the end of 2019 fell to 23,639, which represents the lowest figure since 4Q2015.

Among the key findings, the report found that "institutionally owned" advisers were the most likely to have left last year, with 9.4% leaving (equivalent to 320 posts).

This inexorable across-the-board decline is being driven by a perfect storm of factors including the major banks exiting wealth, removal or reduction of commissions, higher educational standards, and the challenges for many to restructure their advice businesses."

The report said, "This inexorable across-the-board decline is being driven by a perfect storm of factors including the major banks exiting wealth, removal or reduction of commissions, higher educational standards, and the challenges for many to restructure their advice businesses to remain profitable in this new ‘professional' environment."

Australia's financial services industry is still reeling from a series of scandals in 2018 involving the country's "big four" banks, and fall in public confidence in financial advice generally. A year on from the Royal Commission's report, many in the financial services industry are still reeling from the fallout, with 41 investigations still ongoing.

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Christopher Copper-Ind

Christopher Copper-Ind is editor-in-chief of International Investment. Before this, he was editorial director of The Business Year, from 2014 to 2017.