A subsidiary of Australian financial services firm IOOF Holdings has agreed to acquire the advice business assets of Bendigo and Adelaide Bank (Ben) for a cash consideration of A$3m (£1.64m, $2.14m, €1.9m).
Bridges Financial Services will provide ongoing financial planning and advice services to the bank’s customers via a referral agreement.
The agreement with Bridges is expected to be effective from 1 August 2019.
There is also a further sum payable on the first anniversary of completion, subject to maintaining an agreed ongoing service client retention rate.
Reasons for the sale
Ben’s executive of consumer banking, Richard Fennell, said: “At an industry level, we have seen the dynamics impacting financial advice businesses change significantly over the last few years.
“The provision of advice has become a highly specialised capability with the need for significant ongoing investment to meet the increasing regulatory and compliance requirements.
“In considering our advice business as part of our broader banking services, we recognise we will not be in a position to create the specialised focus required to effectively meet our customers’ needs into the future.
“We believe a dedicated focus, from a specialist provider, with the scale and reach of Bridges, will help to ensure our customers’ expectations can be met and that advisers can be supported in meeting future development needs as the industry moves to increase the level of professionalisation of the industry.”
Second sale
In addition, as part of its overall review of the Bendigo Financial Planning operation, the bank will also sell its specialist Geelong West SMSF (self-managed super fund) business to LBW Business & Wealth Advisors, one of Geelong’s locally-owned public accounting practices.
The deal with LBW Business & Wealth Advisors is expected to be effective from 1 July 2019.
The financial terms of the agreement were not disclosed.
