Ray Miles

Ray Miles.

ANZ Banking Group has severed its ownership ties with financial advice company Fortnum Financial Group, making Fortnum one of a growing number of planning businesses agitating to break away from institutional ownership.

Fortnum, which is led by former Genesys Wealth Advisers boss Ray Miles, completed its buyout of ANZ’s remaining 20 per cent stake last Tuesday.

It is understood the deal was worth under $10 million and comes after Fortnum’s management staff and advisers raised capital for the transaction.

ANZ, which originally backed the dealer group in 2010, will continue to provide dealer-to-dealer services to Fortnum. These include compliance, brokerage processing and certain technology services.

“Independence is very important for us – from a client point of view, it’s important we’re not flogging product,” Mr Miles said of Fortnum’s decision to buy back the ANZ stake.

“We believe Fortnum’s open and transparent model will resonate with an increasing number of advisers,” he said.

About 80 per cent of Fortnum’s 28 practices and 87 financial planners and selected staff participated in the scheme to purchase ANZ’s class C shareholding.

Mr Miles previously said the advice group had a “good relationship” with ANZ and OnePath and that the bank had never interfered with the running of the business. However a growing number of their high-net-worth clients wanted the group to be “independently owned”.

About 80 per cent of financial ­planning firms are owned by – or aligned to – the big four banks or AMP. Consolidation has been a key theme in the advice industry following the introduction of the Future of Financial Advice reforms.

But a growing number of advice firms have been agitating to set up their own shops. It was previously reported that certain practices in the ANZ-backed RI Advice are contemplating slashing ties with the bank.

A series of advice scandals involving companies such as the Commonwealth Bank-owned Commonwealth Financial Planning and Macquarie Private Wealth have also put the spotlight on the conflicts that exist when product manufacturers own their distribution channels.

Mr Miles established Fortnum Financial Advisers in 2009, after losing a public legal dispute with Genesys’s former parent, Challenger Financial Services.

ANZ Wealth backed his venture, providing capital and dealer services including licensing, compliance and research. The bank’s minority shareholding gave it two seats on the board alongside Mr Miles and three practice principals.

Mr Miles said the company was also open to potential acquisitions and mergers with other non-bank-aligned firms in the future.