Overseas interest in adviser groups

Several international companies could buy their way into the New Zealand financial advice market in 2014 by purchasing local adviser networks, pundits predict.

Monday, January 13th 2014, 6:00AM

by Niko Kloeten

Consultant Mike Moore says there is interest in the New Zealand market from overseas organisations, including from Australia and Asia.

He expects to see “two, three or four” of these companies enter our market this year.

“Our business has had specific requests from overseas organisations who see themselves developing new networks in New Zealand because they think it’s of interest.”

Moore says one of the reasons for overseas interest is a perceived gap in the adviser market, with fewer than 2000 authorised financial advisers nationwide.

“There’s a huge gap. Now while there may appear to be a lot of people, there are very few who offer face-to-face services to clients.

“The net effect has been to create a gap where if you move away from KiwiSaver you won’t see too many advisers giving you affordable advice at any price.”

Institute of Financial Advisers president Nigel Tate says he is also anticipating international interest in the New Zealand financial adviser market this year.

“The international interests are looking more at groups. I see Goldridge is on the market and I would not be surprised to see overseas interest in an organisation like that.

“It’s quite positive for the New Zealand adviser market. I don’t anticipate a major rush into the market; people have to understand how we operate here.”

Tate says there several factors making New Zealand advisory businesses attractive to overseas buyers, including the improved performance of our economy and the recent regulation of the advice industry.

“I certainly think the marketplace for adviser practices is becoming more attractive. We’re virtually at the end of the regulatory changes; not entirely, but the bulk of it has been done and most adviser businesses are relatively well-structured. Regulation makes us more attractive the closer we are to the market they are already operating in.”

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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