Westpac abandons financial advice
Westpac will get out of the troubled personal advice sector and two of its top executives will depart the bank as it joins its big-four rivals in abandoning the once-dominant model of vertical integration.
The bank announced on Tuesday it would exit the high-cost, loss-making business, producing $280 million in savings by 2020. Westpac group executives George Frazis and Brad Cooper will leave the bank as part of the changes.
Westpac chief executive Brian Hartzer said most customers did not differentiate between banking and wealth products and just wanted help to buy a home or plan for retirement.
“We’re realigning our capabilities into the lines of business where it makes most sense” Mr Hartzer said. “They expect professional service that meets their financial needs.”
The bank did not reveal the consideration being paid for the personal financial advice business being sold to boutique Viridian, which has 130 employees, but it is believed to be less than $50 million.
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