On a probability level, what chance do you (or others) ascribe...

On a probability level, what chance do you (or others) ascribe to a meaningful change in legislation which would have a significant effect on IOOFs business model such as abolishment of vertical integration, and the need to separate advice and platform.

@Just_a_guy

While the forced separation of the Advice business from Platforms and Investment Management is a possibility, it is not obvious to me that such an outcome would end up being in the best interest of consumers.

For, the most immediate consequence of a split-up would be an increase in operational costs for the financial services providers, and there is no guaranteed that such a cost increase would not ultimately be passed on to customers.

Can you see more likely ‘targets’ for the rc recommendations, that will ‘justify’ Haynes time and our money?

From what I can see, it would be a lot simpler and cleaner to just abolish all the incentives (monetary or otherwise) for financial advisers to sell in-house products.

Rules could also be introduced to make sure that the percentage of customer funds invested into in-house products cannot materially exceed the percentage share those products have in the adviser’s Approved Product List (for example, if in-house products represent 25% of the APL, then no more than 35% of customer funds can be invested into in-house products, etc.).

Regarding the likelihood of split-ups being recommended by the RC, I am not sure how meaningful it is to attach probability numbers to scenarios that are politically sensitive (and therefore susceptible to a high degree of irrationality). Anyway, if I had to make a scenario-based valuation, my subjective risk weighting of vertical integration being abolished would be in the order of 20%-25%.

Just my two cents.