Be­yond Que­bec

Investment Executive - - FRONT PAGE - BY FIONA COL­LIE

two que­bec-based re­tail in­vest­ment firms are re­or­ga­niz­ing and re­fo­cus­ing their busi­nesses in an ef­fort to grow their pres­ence out­side their home province.

Mon­treal-based Na­tional Bank Fi­nan­cial Ltd. (NBF) is mak­ing sig­nif­i­cant in­vest­ments out­side Que­bec, with plans to ex­pand its mar­ket share in Western Canada and On­tario. Lévis, Que.-based Des­jardins Fi­nan­cial Se­cu­rity In­de­pen­dent Net­work (DFSIN) un­der­went a distri­bu­tion re­view last year that led to a re­or­ga­ni­za­tion of its busi­ness to po­si­tion the firm bet­ter for growth.

(NBF is Na­tional Bank of Canada’s bro­ker­age arm. DFSIN

is Des­jardins Group’s in­de­pen­dent mu­tual fund ad­vi­sor net­work. In Que­bec, DFSIN op­er­ates un­der the brand SFL — Part­ner of Des­jardins Fi­nan­cial Se­cu­rity.)

“The mar­ket out­side Que­bec has lots of op­por­tu­ni­ties,” says Michael Rogers, se­nior vice pres­i­dent, in­de­pen­dent net­work sales and distri­bu­tion, with Des­jardins Fi­nan­cial Se­cu­rity Life As­sur­ance Co. “We al­ready have the ex­per­tise un­der our belt and rolled it out in the province of Que­bec. So, we’re look­ing to cap­i­tal­ize on that ex­per­tise and roll it out across the coun­try in a more ef­fi­cient way than we’ve prob­a­bly done in the past.”

Cur­rently, Des­jardins Group’s mu­tual fund-fo­cused distri­bu­tion net­works — which in­clude DFSIN and the par­ent firm’s mu­tual fund dealer, Des­jardins Fi­nan­cial Se­cu­rity In­vest­ments Inc. — have about 1,000 ad­vi­sors out­side Que­bec who col­lec­tively man­age about $8 bil­lion in as­sets. Na­tion­ally, these distri­bu­tion net­works have about $16 bil­lion in as­sets un­der man­age­ment (AUM).

DFSIN’s man­age­ment has stream­lined the firm’s busi­ness by re­duc­ing the num­ber of fi­nan­cial cen­tres out­side Que­bec to eight from 28 in an ef­fort to in­crease AUM. Al­though two of these cen­tres have been closed out­right, most have been merged to cre­ate cen­tral­ized, but still lo­cal of­fices that will pro­vide direct sup­port to ad­vi­sors.

DFSIN’s fi­nan­cial cen­tres are ded­i­cated of­fices that pro­vide re­sources for ad­vi­sors. For ex­am­ple, the fi­nan­cial cen- tres may have sev­eral man­agers fo­cused on dif­fer­ent ar­eas, such as in­vest­ments or tech­nol­ogy. DFSIN’s ad­vi­sors work with the dealer as in­de­pen­dent part­ners, so they have the choice to run their busi­ness out of a fi­nan­cial cen­tre or out of their own, in­de­pen­dent of­fice.

“Ba­si­cally, what we wanted to pro­vide is a model that gives ad­vi­sors the flex­i­bil­ity to work as they wish,” Rogers says.

DFSIN also made changes to its man­age­ment this year with the ap­point­ment of three ex­ec­u­tives. Yves Giroux, vice pres­i­dent, multi­net­work busi­ness de­vel­op­ment, Des­jardins Fi­nan­cial Se­cu­rity Life As­sur­ance, is in charge of de­vel­op­ing fi­nan­cial plan­ning and whole­sal­ing. Marie-Josée Audet, whose ti­tle is direc­tor, op­er­a­tional ex­cel­lence and ad­min­is­tra­tion, will fo­cus on op­er­a­tions for Des­jardins Group’s distri­bu­tion net­works, in­clud­ing the de­vel­op­ment of tech­nol­ogy for DFSIN ad­vi­sors. And De­nis Black­burn is vice pres­i­dent, sales per­for­mance and distri­bu­tion man­age­ment, for DFSIN, SFL— Part­ner of Des­jardins Fi­nan­cial Se­cu­rity and Des­jardins Fi­nan­cial Se­cu­rity In­vest­ments Inc.

These ex­ec­u­tives are tasked with help­ing the mu­tual fund dealer di­vi­sions of Des­jardins Group move for­ward with four new ar­eas of fo­cus: fi­nan­cial plan­ning; tech­nol­ogy; mar­ket­ing and brand­ing; and recog­ni­tion and train­ing pro­grams. Tak­ing this ap­proach is ex­pected to help DFSIN in­vest and de­liver in each area, whether that’s through hav­ing fi­nan­cial plan­ning ex­perts in fi­nan­cial cen­tres or the Toronto of­fice, or bring­ing elec­tronic sig­na­tures and ETFs to ad­vi­sors’ busi­nesses.

NBF also aims to build out its foot­print by in­vest­ing in tech­nol­ogy and re­cruit­ing ad­vi­sors — par­tic­u­larly out­side Que­bec. Cur­rently, NBF has $107 bil­lion in AUM and about 860 ad­vi­sors across Canada. To grow those num­bers, Martin Lav­i­gne, pres­i­dent of NBF’s wealth­man­age­ment di­vi­sion, is fo­cus­ing the bro­ker­age on what he has dubbed “Vi­sion 2021.”

This plan is meant for the en­tire bro­ker­age, and Lav­i­gne ex­pects NBF to con­tinue grow­ing or­gan­i­cally in Que­bec. How­ever, the firm is in­vest­ing sig­nif­i­cantly in other re­gions, such as On­tario and Western Canada, with the lat­ter a key pri­or­ity. For ex­am­ple, NBF has in­vested $10 mil­lion in a new of­fice build­ing in Van­cou­ver.

“We’re put­ting a lot of money, a lot of ef­fort into Western Canada be­cause that’s where we want to grow,” Lav­i­gne says. “That’s where I be­lieve the op­por­tu­nity is.”

An­other part of the plan for Lav­i­gne is to con­tinue re­cruit­ing ad­vi­sors. He says the com­pany will fo­cus on en­tre­pre­neur­ial-minded ad­vi­sors who have grow­ing books of busi­ness. To achieve that goal, NBF fo­cuses on mar­ket­ing to in­di­vid­ual ad­vi­sors (rather than launch­ing na­tional cam­paigns) and build­ing out ad­vi­sor teams.

“We’ve [used] a strat­egy of a very, very ag­gres­sive team pol­icy,” Lav­i­gne says, “to help ad­vi­sors re­cruit the next gen­er­a­tion [of ad­vi­sors] to help them in their busi­ness.”

In­deed, ad­vi­sor teams are in­creas­ingly more com­mon, ac­cord­ing to Toronto-based In­vestor Eco­nomics’ re­cent Re­tail Bro­ker­age Distri­bu­tion and Ad­vi­sory Ser­vices Re­port.

Fur­ther­more, ad­vi­sor teams in the fu­ture are likely to in­clude sev­eral ad­vi­sors of dif­fer­ing ages and ar­eas of ex­per­tise who will be able to op­er­ate the busi­ness in the event of a re­tire­ment while also han­dling the com­plex needs of an ag­ing client base, says Jonid Lesko, se­nior an­a­lyst with In­vestor Eco­nomics.

Re­gard­less of whether NBF’s ad­vi­sors are in teams, the firm plans to roll out new tech­nol­ogy tools within the next two years. These tools are meant to make ad­vi­sors’ busi­nesses more ef­fi­cient and col­lab­o­ra­tive, Lav­i­gne says. For ex­am­ple, new tools may in­clude “in­tel­li­gent” dash­boards that send im­por­tant data to ad­vi­sors and a dig­i­tal “on­board­ing” plat­form for new clients to fill out on their own or with an ad­vi­sor.

“It’s all about how we dig­i­tize the client jour­ney,” says Lav­i­gne. “Ev­ery tool that’s re­lated to the client jour­ney is a tool that we’re look­ing to de­velop and launch.”

“Ba­si­cally, what we wanted to pro­vide is a model that gives ad­vi­sors the flex­i­bil­ity to work as they wish”

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