New findings provide first market snapshot of New Zealand’s financial advisers

Media Release
MR No. 2015 – 12
23 April 2015

The Financial Markets Authority (FMA) has today published results from its first questionnaire of Authorised Financial Advisers (AFAs) in New Zealand. The report provides insights into the shape and practices of this sector of the financial advice industry.

Under recent reporting requirements, AFAs are required to complete an annual information return, providing the regulator with important information about the industry. The first return was completed by advisers last September, based on their activity in the 12 months up to June 2014.

The FMA’s Head of Supervision, Kirsty Campbell said: “this is the first time the FMA has been able to provide some market analysis of authorised financial advisers, the report provides a unique snapshot of the industry.”

“Not only does this information help inform our risk-based approach to monitoring and supervision, it also enables AFAs and stakeholders to better understand the dynamics of the industry,” she said.

There are about 1,800 AFAs in New Zealand, with 90 per cent of AFAs actively providing advice to New Zealanders.  AFAs are required to be authorised by the FMA.

New Zealand’s financial advice industry consists of three types of adviser; AFAs, registered financial advisers, and those linked to a Qualifying Financial Entity (such as a bank, fund manager or insurance provider) who do not have to register individually.

AFAs are required to submit an information return to the FMA each year. The 2014 results will be used as baseline of information to monitor emerging trends in the coming years.

Contact:
Andrew Park
09 967 1215
021 220 6770
[email protected]

Background:
A review led by the Ministry of Business, innovation and Employment of the legislation governing how financial advice is provided is currently underway. This includes making recommendations on how the Financial Advisers Act and the Financial Service Providers Act may be improved. A discussion document is expected to be completed by June 2015.

For more information and to view the Terms of Reference visit: www.mbie.govt.nz/what-we-do/review-of-financial-advisers-act-2008