The Financial Markets Authority released its third statistical report on Authorised Financial Advisers (AFAs) today.
The report uses the data from a compulsory questionnaire for AFAs to provide a snapshot of the sector for the 12 month period ending June 30th 2016.
The number of AFAs in New Zealand total about 1800 from 30 June 2016, steady on 2015 figures.
But unlike 2015’s figures, more AFAs are joining the industry than leaving, with 120 new recruits versus 80 who left. In 2015, 90 AFAs joined the industry and 110 left.
The results also showed that AFAs are now less likely client bases exceeding 300 clients than they were in 2014.
Since 2015, more advisers have total client assets of over $100 million but those with total client assets between $1million and $5million has fallen over the past three years.
For AFAs who do not work for a QFE, over half receive commission for their services and one in five get more than half of their commission and bonuses from one product provider.
Only one fifth of AFAs who work for a QFE are paid commission, with 14% of them generating over half of their commission and bonuses through the sale of products from one provider.
For insurance advice, the majority of AFAs provide advice on insurance polices and about half provide financial advice on the replacement of insurance products to between 1 to 10 clients a year.
Over half of AFAs provide advice about joining or transferring to just one KiwiSaver scheme, an increase from 47% of AFAs in 2014 to 52% in 2016.
However the percentage of advisers offering advice on between 2 to 4 KiwiSaver schemes fell from 41% in 2014 to 35% in 2016.