Westpac Group will exit offering personal advice by salaried and authorised representatives by September 2019, it confirmed on Tuesday.
The changes are part of “resetting” the bank’s wealth strategy.
Group chief executive Brian Hartzer said exiting BT Financial Group’s advice business “reflects the changing external environment, including a trend by financial advisers to operate independently, or in smaller advisory groups”.
“The decision to exit the provision of personal financial advice by financial advisers under our licence has not been taken lightly, and our priority is to ensure the smoothest possible transition for customers, advisers and support staff.”
According to the bank’s presentation on changing its wealth strategy, “the percentage of Australian planners under licence to major banks [and wealth manager] AMP has steadily declined”.
“We expect this trend to continue.”
Additionally, the number of advisers working at BT Financial Group has “reduced significantly over the last four years”.
Fees for no service
Australia’s Royal Commission into banking, superannuation and financial advice is the spectre that won’t disappear.
It lifted the lid on some very unsavoury practices by financial institutions and advisers.
It has accelerated a growing shift away from the vertically integrated model that has dominated Australia’s advice sector.
Westpac is one of a number of firms that have been ordered to repay fees to clients who received no service.
As of 30 June 2018, it had paid A$6.9m (£3.7m, $4.9m, €4.3m) and expects to fork out an additional A$20m.
The bank expects to complete the remediation programme by the fourth quarter of 2019.
