netwealth bolsters managed accounts offering

netwealth executive director Matt Heine.


By Julie May

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Financial services group netwealth will strengthen its managed accounts market position by the end of the calendar year, as its platform hit a record $6 billion in funds under management (FUM) mid-last week, the group’s executive director has said.

Speaking to financialobserver, Matt Heine said netwealth’s fully integrated managed accounts service offering would be launched by the end of 2014 and was expected to have a further positive impact on FUM across the group.

“Currently, external mangers and managed discretionary account operators can utilise our technology to administer their internal managed accounts, but come the end of 2014, early 2015, netwealth will be offering its own managed account service, specifically a separately managed account,” Heine said.

“The product will provide access to approximately 11 managers and 24 models, which will be run under a netwealth non-unitised managed account structure integrated into our broader investment and superannuation platform offering.”

Heine said netwealth was focusing on a number of key areas of development across the group and it was a priority to lift its managed accounts offering to a fully integrated managed accounts service.

He said the group was talking to a number of licensees about the new offering, including existing and potential platform clients, highlighting that the added capability would be a “game changer”.

“A lot of people have been talking about managed accounts for many years and for those of us who are already there, what’s happening is evolving at a rapid pace,” he said.

In regard to the group’s platform, which would see further inflows following the addition of increased managed accounts capabilities, he said its aligned financial planning firms represented about 15 per cent of FUM on platform, while 85 per cent came via external planning and private groups.

“Greater technology and capabilities are key factors for netwealth, and I’m confident we will hit $7 billion in platform FUM by the end of the financial year,” he said.

He said the group had about 45 advisers in its subsidiaries, Financial Planning Services Australia (FPSA) and Bridgeport Financial Services, while its Pathway Licensee Services business offered a range of solutions to more than 200 Australian financial services licensees.

“We’ve got a strong pipeline of advisers we’re talking to and we’d like to grow our network to around 100 advisers over the next two to three years,” he said, pointing to last week’s successful acquisition of Canberra-based Empire Financial Planning.

Meanwhile, netwealth, together with the Institute of Managed Account Providers (IMAP), Hub24 and Philo Capital, is preparing to provide FPA congress delegates with greater insights into the various managed account operating models in the market at the FPA national conference in Adelaide later this month.

IMAP chair Toby Potter said many advisers realised managed accounts offered them an opportunity to transform their business structures.

“There are [however] a number of competing models which offer differing benefits and this [will be] an opportunity for advisers to compare several key alternatives in one location," Potter said.

He added IMAP, netwealth, Hub24 and Philo Capital agreed there was an immediate need to build the depth of understanding about managed accounts to enable advisers and licensees to make more informed decisions when evaluating and selecting managed account structures.

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