Advisor | April 2023

One of the most debated issues in recent years and during the last edition of Consulentia 2023 is the inclusion of new financial professionals in the world of financial consultancy. 

Traditional banks, it is true, represent a veritable nursery of financial advisors. In this respect, some figures may clarify the extent of this phenomenon.

On average, over 55% of new recruits come from the ranks of bank managers. Some instances have greatly exceeded this percentage, welcoming 75% of bankers and, in one case, 92%.

These figures do not come as a surprise to insiders and find their explanation in a series of objective and subjective factors.

Objective factors can be summarized in a few telling numbers: in less than twenty years, over ten thousand bank branches have been closed and over fifty thousand bankers have left or have been encouraged to move.

The so-called depopulation of banks has been countered by the establishment of over six hundred offices headed by networks of financial advisors.

Thus, the space once occupied by banks, especially in prestigious areas, is today occupied by offices of financial advisors.

Offices of financial advisors are certainly more pleasant and welcoming, being dedicated exclusively to hosting meetings with clients. Moreover, they have more affordable costs as they do not require, contrary to bank branches, security management connected to the presence of liquidity and securities.

This revolution has famously been triggered by a change in the customers’ habits, who today enter the bank directly from their smartphones. However, financial networks are digital natives and, as such, they can better assist their clients as compared to traditional banks.

So, why aren’t we witnessing a mass exodus from banks to financial networks? In this case, we must take account of a series of subjective factors at play. In fact, not all bank employees want and can be financial advisors.

As any other profession with an inherent entrepreneurial risk, the job of financial advisor includes some psychological barriers: not everyone is willing to take the leap and give up a fixed salary. Moreover, many are afraid to be unable to create a client base; thus, despite their unsatisfaction, they are afraid to leave their certainties for the uncertain.

On the other hand, we also must acknowledge that 85% of the employees who took the leap and became financial advisors are today happy and satisfied and would certainly not go back. But how many bankers who could potentially become financial advisors are too afraid to take the leap? We estimate they are between 10% and 15%, which means that financial networks would be able to choose among a larger base, that is about 30.000 professionals.

Of course, today the ability to evaluate and attract talents represents a huge competitive advantage.

Financial advisors are not free agents anymore – they need a team, a working car and to find every day the right motivation. All this cannot be improvised.

There is another noteworthy fact: among the bankers who have decided to take the leap and become financial advisors, the number of women and professionals under 40 is above average.

Is this the beginning of a new season?

Nicola Ronchetti