AMP authorisation continues despite Invest Blue’s Ironbark deal

ANALYSIS

When the merger of Ironbark Investment Management and Invest Blue was announced to the market early yesterday, the question promptly asked by Financial Newswire readers was: “How will AMP feel about that?”

It represented a highly pertinent question because Invest Blue represents one of the largest businesses operating under the AMP Financial Planning license and one which has been fundamental to AMP’s revamped approach to advice delivery over the past two years.

What advisers can be certain about is that AMP would have been well aware of the fact that one of its major aligned financial planning practices was in discussion with Ironbark and that, in fact, Ironbark had been in the business of growing its presence in wealth management via equity stakes.

For starters, it is worth knowing that as at July, Ironbark Wealth Management Pty Ltd owned 37.76% of Invest Blue while AMP Group member, Associated Financial Planners Pty Ltd held 12.74%.

And it says something about AMP’s future intentions with respect to financial advice delivery that it is comfortable with Ironbark and Invest Blue seeking to form what they were yesterday describing as “one of Australia’s largest diversified financial services businesses”.

Consistent with an emerging trend in the financial advice sector, equity stakes in financial planning businesses are seen as delivering more value than own an Australian Financial Service License with all its attendant regulatory costs.

In many respects the Invest Blue merger would appear to flow from last August’s news that Washington H Soul Pattison had agreed to bankroll Ironbark to pursue its ambitions with respect to wealth management stakes.

Invest Blue managing director, David Stephen delivered context when he noted that the strategic partnership with Ironbark would provide capital, scale and expertise”.

Notwithstanding its continuing association with AMP, Invest Blue has been charting its own commercial course for some time, not least its announcement in May that it was taking a $2 million strategic stake in advice and client engagement platform, Lumiant to roll out a digital advice solution.

Invest Blue also in mid-2022 also entered a strategic partnership with outsourcing company, Virtual Business Partners.

However, from a licensing perspective, Invest Blue will continue to operate as an authorised representative of AMP Financial Planning.