Network community is in better shape than ever
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Following the lead article in the July 12 issue of Mortgage Strategy on the loss of appointed representatives I would like to provide some balance, as readers may get the idea that the AR and network community is haemorrhaging.
If we look back 20 years there were more than 200,000 registered advisers in the industry. Now the number remaining is just 10% of that, so it’s clear that the loss of 72 ARs hardly constitutes a catastrophe.
In fact, in 2010 the network proposition is stronger than it has ever been, with the best networks having come through the recession because they are adequately financed and have been able to adapt to changing circumstances.
We have recruited 43 firms this year and made a net gain in our membership.
As with other networks, there will always be a degree of AR turnover and we are not immune to companies getting out of a tough market.
And in the next year retention will be a challenge as the Financial Services Authority introduces tests of suitability and financial solvency which networks will have to implement.
But I believe this will be balanced by an influx of smaller directly authorised brokers who will find the proactive FSA a different animal from the light-touch version of previous years. Networks will provide a secure base from which advisers can ply their trade.
I can’t imagine the FSA or its successor having the resources or inclination to administer thousands of small directly authorised firms unless it makes a significant investment in compliance provision. Networks represent a viable future for smaller firms.
Chris Tanner
Managing director
Homeloan Partnership
