AFA, FPA merger talks continue

Reform proposal may make way for merger

By Kate Kachor
Wed 28 Apr 2010

Merger discussions between Australia's advice associations continue.

Merger talks between the Association of Financial Advisers (AFA) and FPA are continuing, albeit slowly, according to AFA chief executive Richard Klipin.

"The AFA, FPA merger conversation is continuing slowly," Klipin said.

"Obviously the FPA is in the process of appointing a new CEO and I think certainly at an AFA board level we're committed to having the discussion."

Klipin's comments come just days after the federal government announced wide-sweeping reforms of Australia's financial services industry, in particular the banning of commissions.

It is understood merger talks stalled between the AFA and FPA over their differing views regarding commission payments to and received by financial advisers.

However, with the government's proposed removal of commissions, the remuneration debate would cease to act as a merger roadblock.

"The landscape is shifting. The future is going to be very different from the past and I think that's going to provide both challenges and opportunities for everybody and in association land I don't think it's any different," Klipin said.

"The message to the market place is if you're a small business person and there is regulatory risk you need to think about how you position your business and you need to think about the value to your clients."

In response to Klipin's comments, FPA acting chief executive Deen Sanders said: "I'm not able to make any comments on that."

"That is specifically reserved for the board to discuss. I don't think the minister's reform package will have any impact on those discussions."

The government's measures, announced on 24 April, were in response to the Parliamentary Joint Committee on Corporations and Financial Services' inquiry into financial products and services in Australia.

Go to today's InvestorDaily news

More stories by this author