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10 key facts from Old Mutual Wealth's giant advice pitch

We trawled through Old Mutual Wealth's 141 page presentation to dig out its advice business plans. Here are 10 of the most interesting things we found out.

Old Mutual Wealth held a presentation for investors yesterday about its plans to float separately. 

While the headline news was a change of name to Quilter, the presentation also revealed a lot about the businesses' plans and performance. 

Read on to see how Old Mutual Wealth's restricted advice numbers have risen, and how old the average Intrinsic adviser is. 

All charts are taken from Old Mutual Wealth. We have referred to the business as Old Mutual Wealth rather than Quilter to avoid confusion before the name change is completed. 

Old Mutual Wealth held a presentation for investors yesterday about its plans to float separately. 

While the headline news was a change of name to Quilter, the presentation also revealed a lot about the businesses' plans and performance. 

Read on to see how Old Mutual Wealth's restricted advice numbers have risen, and how old the average Intrinsic adviser is. 

All charts are taken from Old Mutual Wealth. We have referred to the business as Old Mutual Wealth rather than Quilter to avoid confusion before the name change is completed. 

Old Mutual Wealth now has the second largest advice force in the UK, according to this slide. 

This might go some of the way to explaining why Old Mutual Wealth's advice chief said the company was the 'only only credible scale competitor' to St James's Place. 

The slide also suggested its advice arm has grown at a much bigger rate than the number of advisers across the country.

Restricted advice is clearly an important part of the plan for Old Mutual Wealth/Quilter going forward. 

On the left, you can see the acquisitions Old Mutual Wealth has made in the advice market since it bought Intrinsic in 2014. 

The graph on the right shows how the number of restricted advisers has grown since the Intrinsic deal was completed. As you can see the number has more then doubled. 

Looking in more depth at the numbers, 266 of these new restricted advisers have come from organic recruitment efforts, 267 have come from converting existing independent advisers to restricted status, and 350 have come through acquisitions, as seen on the right of the slide. 

New Model Adviser® profile star Jason McGuigan of Critchleys has recently become a restricted adviser with Intrinsic. Read about his experience here.

Building on the rise in restricted advisers, this slide shows more details on Old Mutual Wealth's advice force. 

On the left the map of the UK shows where Old Mutual advisers are based, and how it has split the country into regions. The yellow dots are where it has acquired firms for restricted national advice firm Private Client Advisers (PCA for short). 

The pie chart on the right shows how advisers are broken down by age. The average age of 48 is probably slightly lower than across the whole market, but 47% of the advisers at Old Mutual Wealth are still aged 50 and over. Just 5% are below 30. 

 

This breakdown of client segmentation across Old Mutual Wealth's advice business offers insight into some of its plans. 

PCA, the restricted national business, is targeted at wealthier clients with £250,000 of assets to invest. This is probably born out of its creation as a business aligned with Quilter Cheviot. 

The chart on the right shows that 38% of PCA clients have more than £1 million and 44% have between £250,000 and £1 million.

By contrast the Intrinsic network's target market is clients with between £100,000 and £250,000 of assets. 

The chart on the right, which does not include any mortgage and protection advisers, shows that 67% of the network's 200,000 clients have £250,000 or less in assets. Just 5% of these clients have more than £1 million.

This slide may appear confusing at first, but it shows how Old Mutual Wealth's vertically integrated model is working out. 

First thing to note is that NCCF stands for net client cash flow. That is, the amount of client money that goes into a particular part of business in a certain timeframe, minus any withdrawals made during that period. 

Number one above shows Old Mutual Wealth's advisers contributed £1.1 billion to multi-asset business Old Mutual Wealth Investors in the first half of 2017. This is significantly higher than in previous six month periods. 

Number two shows how Old Mutual Wealth advisers have delivered business to discretionary fund manager Quilter Cheviot. This also increased significantly in the first six months of the year, although on a smaller scale. 

The final chart shows the same figures for the Old Mutual Wealth platform. 

 

 

Replatforming has been a major issue in the platform market, and no platform has been through as much of a bumpy ride as Old Mutual Wealth. 

In May this year the company dropped IFDS as the provider of new technology in favour of a deal with FNZ. 

This side addresses how the FNZ project is going, and the answer seems to be okay. The project is 'on track' to be completed by early 2019 at the latest, and costs are expected to stay between £120 million and £160 million. 

The platform appears to be doing good business for Old Mutual Wealth despite the technology issues it has faced this year. 

In the first half of the year it recorded net inflows of £2.1 billion. Of these 29% came from restricted advice, and 37% went into funds run by Old Mutual Wealth Investors. 

Looking at the total £45.9 billion of assets on the platform, 8% are from restricted advice and 14% are invested in Old Mutual Wealth Investors. 

 

This slide essentially speaks for itself: pensions are good business for the Old Mutual Wealth platform. 

Pension assets make up 41% of the total £45.9 billion on the platform. 

Flows are also high, although it would be interested to see how the figures compare with data before the pension freedoms were introduced in 2015. 

Advisers will probably have seen the benefits of Old Mutual Wealth's platform in marketing material before, but the information on the left shows some details about clients on the platform. 

The last note is particularly worth noting: over 40% of customers eligible to take advantage of the pension freedoms, that is those ageed 55 and over, have done so. 

This shows how Quilter Cheviot has contributed to the Old Mutual Wealth business. 

Again this shows a trend of rising restricted advice assets. Intrinsic clients account for £400 million of assets and PCA clients account for £300 million.

To see the presentation in full click here.

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