The Future of Financial Advice laws that kicked off in 2013 banned conflicted payments to financial advisers, but ongoing commissions already in place continued to be paid under so-called grandfathered arrangements. It has been widely speculated the Hayne royal commission will ban the payments and a number of financial services giantslike Macquariehave already pre-empted such a move.
Sources said questions were also raised about the bank’s incoming fee structure that is expected to charge clients 1.0 per cent fee for their first $5 million invested. The fee, which is prior to GST, would be reduced to 0.5 per cent for those with invested assets over $30 million.
The exodus leaves Macquarie Private Wealth with between 150 and 175 advisers. A decade ago, it had more than 400 advisers.
‘The way forward’
A spokeswoman for Macquarie said the departures were triggered by the decision to scrap adviser commissions.
“Last year we made industry-leading changes by moving all of our advisers away from commission-based remuneration and, as expected, we’ve seen a small minority of advisers choose to depart, as they did not feel aligned to the future of the business,” she said.
“We believe these changes are the way forward for our clients and our people and are in line with both changing expectations and our commitment to industry best practice.”
Adelaide was the hardest hit by the pre-Christmas departures,with more than 10 advisers includingJohn Fowler, Emma Trengove and Nick Pyne leaving to join former colleague Brenton Howard at Ord Minnett.
Earlier that week, Queensland-based Morgans Financial hadpoached a handful of Macquarie advisers, including Peter Harris, Tim Clarke and Piers Arundell to set up a new outpost in Adelaide.
In Perth, nine advisers left that week, including Trent Savage, Andrew White, Michael Harwood, Matthew Chambers, Bevan Sturgess-Smith and Michael Moursellas.
And in Canberra two advisers jumped ship that day.Shaw and Partners had previously swooped on the bulk of Macquarie’s Canberra team last year to set up its own shop in the ACT.
Macquarie’s private wealth division haspreviously been subject to a two-year enforceable undertakingafter the corporate regulator accused Macquarie of misclassifying clients, sloppy paperwork and rampant cheating on continuous professional development exams.
The undertaking came to an end in 2015 but Macquarie remained on probation for another year.