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Regrets, but takeover was best option, says founder

COUNT Financial's founder, Barry Lambert, admitted wiping back a tear on the way to his Sydney office yesterday as the independent advisory firm he built up over three decades was set to be folded into the nation's biggest bank.

COUNT Financial's founder, Barry Lambert, admitted wiping back a tear on the way to his Sydney office yesterday as the independent advisory firm he built up over three decades was set to be folded into the nation's biggest bank.

Now executive chairman of Count, Mr Lambert had been planning to remain fiercely independent and driving Count's own acquisitions.

But with looming financial advice reforms causing deep anxiety among a whole range of smaller planners, he knew the Commonwealth Bank's $373 million offer was too good to refuse. "In some ways it's a sad day. I choked up a bit driving across the bridge knowing this was going to happen," Mr Lambert said yesterday.

However, he was "110 per cent behind the transaction", which he argues will provide greater certainty for staff as well as customers.

The Future of Financial Advice reforms, which are being steered by the Assistant Treasurer, Bill Shorten, are aimed at boosting transparency of financial advice as well as removing conflicts inherent across the industry.

The heart of the proposals involves scrapping commission-based payments on advice and having clients opt in to investment products every two years. The reforms are still some way off with the second tranche of the legislation yet to be released.

However, they have been cited for sparking a wave of mergers among the smaller end of the advisory chain. Among key concerns is that smaller players may struggle to shift to a fee-for-service offering given they lack scale.

One player that has already done its own acquiring is the high-end independent advisory house Snowball Group. It has recently merged with Shadforth Financial to create the nation's biggest independent advice and wealth business.

Snowball's chief executive, Tony Fenning, said the financial advice industry was starting to look top heavy, with the planned reforms favouring a shift to scale.

"We're running out of competitors - anything much smaller than us and it would be difficult to manufacture services for your client," Mr Fenning said yesterday. Other moves in recent months include wealth manager IOOF Holdings making a $115 million move on planning house DKN Financial to boost distribution.


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