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Insignia reports $8.3bn FUA lift in 3Q24

By Keith Ford
3 minute read

Insignia Financial unveiled its results for the third quarter of the 2023–24 financial year.

Insignia’s funds under administration (FUA) hit $223.4 billion as at 31 March, which was an increase of $8.3 billion (3.9 per cent) over the previous quarter, while its funds under management (FUM) reached $88.9 billion, an increase of $3.4 billion (4.0 per cent).

In an announcement to the ASX on Thursday morning, the firm said the increase in FUA was driven by market movement of $10.6 billion (up 4.9 per cent), partly offset by net outflows of $1.5 billion and pension payments of $868 million.

“The net outflow was largely attributable to outflows of $1.2 billion from MLC Wrap ahead of the migration to Expand at the end of March 2024. Net inflows of $512 million into the Expand platform demonstrate support for the go forward Advised offering,” Insignia said.

The growth in FUM was driven by positive market movement of $3.6 billion (up 4.3 per cent), partly offset by $197 million in net outflows.

Insignia Financial chief executive officer Scott Hartley said: “It has been pleasing to see continued progress against the FY2024–26 strategic initiatives announced in July 2023.

“Strong growth in FUMA over the quarter has been supported by positive investment markets and reflects the benefits of scale, while our flagship Expand platform is achieving consistent net inflows.”

Moreover, the licensee lost 99 advisers in the third quarter of FY24, with the majority attributed to Godfrey Pembroke’s exit.

Following the February 2024 sale agreement with Practice Development Group to return ownership of Godfrey Pembroke (GPG) to advisers, Insignia’s financial adviser numbers fell to 1,100, from 1,199 at the half.

This comprised 208 advisers in the professional services (employed) channel and 892 advisers across advice services channels (self-employed and self-licensed).

Expand migration

Insignia also announced the completion of its $38.6 billion migration of more than 94,000 client accounts from MLC Wrap, MLC Navigator, and associated offers, to Expand, its “contemporary superannuation, pensions, and investments wrap platform”.

Insignia Financial chief distribution officer and head of superannuation, Mark Oliver, said: “This complex migration has delivered our simpler, faster, and easy-to-use Expand platform to more advisers and clients.

“Expand is a key part of our offer to advisers and their clients. Our established technology and in-house capability is contemporary, intuitive, and simple to use, enabling business efficiency and better outcomes for clients.

“This migration is a significant simplification milestone for Insignia Financial, following the acquisition of MLC in 2021, and supports our strategy and delivers scale benefits, with 98 per cent of migrated clients benefiting from fee reductions in Expand.”

According to Insignia, the 318,000 clients and $86 billion in total FUA across Expand, employer super, and other wrap offers places Insignia Financial’s proprietary technology as the third-largest wrap platform in the market and the largest by number of client accounts.

“One of the benefits of proprietary technology is we can continue to evolve the platform quickly and efficiently. We are committed to working closely with advisers to continue to deliver features and enhancements in line with changing needs and would like to thank them for their support and patience during this process,” Oliver said.

Hartley added that the migration represented a “significant milestone” in the optimisation of the business.

“The Expand platform will deliver an enhanced, modern solution to migrated clients and their advisers, and allows Insignia Financial to further simplify and reduce costs. We expect to see an improvement in net inflows over the longer term as we work through this transitionary period,” he said.