Sesame Bankhall Group must get better at communicating its achievements but it is still struggling to find the right tone of voice, according to managing director Stephen Gazard.
Speaking to FTAdviser, to sum up fortunes at Sesame Bankhall he reversed the usual phrase to “the reality is actually better than the perception.”
Both staff and adviser partners are getting back to the day job after a tumultuous year, he said.
His comments came as Financial Adviser’s Top 100 Financial Adviser list showed Sesame has slumped down the list by nine places from last year to 20th this year.
“We want to draw a line in the sand after the strategic review and now the backing of Aviva is confirmed. There’s three forward facing businesses and a legacy business, so we’re trying to ensure nothing comes out of the woodwork as a distraction now.”
Bankhall, Premier Mortgage Services (PMS) and the mortgage network are all being driven forward by Mr Gazard, who is actively trying to get the communications balance right, as he admits, “we’re not so good at shouting from the rooftops.
“The tone of voice must be correct, as it is now about engagement with firms and getting the right communications process in place,” he said.
At the end of March, the group announced that Sesame would not longer offer a network for retail investment advisers, in a move blamed on a Retail Distribution Review-inspired “natural migration” towards direct authorisation.
Doubt was also cast on the group’s future after its parent company Friends Life was taken over by Aviva earlier this year, with the latter pointing out that the distribution business is only viable thanks to currently “open-ended” financial support from the former.
Sesame, the UK’s largest and oldest advisory network, made losses of approximately £19m for the 2013 financial year, after it was hit with fines for past mis-selling.
Friends Life had started a strategic review of SBG in early 2013 in order to “address the structural issues so as to reduce or remove the need for financial support”.
The review already moved it to a wholly restricted advice model, operating through two strands including a panel-based service.
Pay to play deals with providers were also responsible for a regulatory penalty of £1.6m last year.
In April, Sesame wrote to appointed representatives promising a variety of benefits, including continuation of trail commission, if they switched to sister company Bankhall or a preferred partner, which turned out to be Intrinsic.
At the start of September, SBG confirmed an executive team reshuffle, following the completion of its strategic review. Later that month, Sesame was forced to defend a £10.2m loss relating to turmoil within the network, which meant it had to set aside £31m for complaints liabilities.
As for the recent departure of the mortgage network’s managing director John Cupis - who left for rival Openwork in September - and his replacement Lisa Martin just three weeks after being promoted to replace him, Mr Gazard said he was sad to see them go but that the business was stronger than one or two individuals.
“There was always going to be inevitable fallout from the restructure, but there will be no knee jerk response, we’re engaging with our stakeholders to identify gaps and fill them.
“We’re looking for a dynamic sales director to come in an ensure that propositions remain at the forefront and keep the client bank growing,” he added.
In July, Aviva and Friends Life offered Sesame a combined £45m to cover adviser liabilities, with a spokesperson stating this was also to help build “a profitable, sustainable and attractive business in its chosen markets” as part of a three-year plan for development.
“It remains a challenging environment, but we’re getting back to the day job and there is enthusiasm again after a year of change,” added Mr Gazard. “Rumours of our death have been greatly exaggerated.”
He explained that Bankhall’s consultancy arrangement has meant turning away more advisers than it took across, as appointed representatives became directly authorised businesses under the new model.
A “very clear selection process” should reduce risk for the business and he now has “bullish plans” going forward.
“As far as I’m concerned, compliance services is hygiene. We really want to widen out beyond that,” he commented, citing the recent research tie-in with Distribution Technology as one of several new partnerships and initiatives to be launched over the coming months.
As for the PMS mortgage club, this is also “a source of untapped potential” which will now be able to fully utilise wider group resources to grow, without the distractions of the last year.
“The focus is now on regulatory compliance and mortgage services,” says Mr Gazard. “We need to make it clear that the culture and stance has changed from three years ago, it’s not all about size, instead we want to put the right systems and controls in place to drive growth forward sustainably.”
To that end, the group has set up 12 man advisory boards across all three businesses, consisting of a mix of member representatives, so that any future changes are better communicated and consulted upon.
peter.walker@ft.com
