The wealth management division of iA Financial Group based in Quebec City, currently headed by Stephan Bourbonnaisdoes not waste time adapting to the new regulatory system.
In late January, Bourbonnais was named executive vice president of wealth management – overseeing iA Clarington Investments, Investia Financial Services, iA Capital Markets and iA Private Wealth – and said the company has already applied for dual registration status under Canada’s New Self-Regulatory Organization (New SRO).
New SRO published the questionnaire in December which offered instructions to companies wishing to operate under its supervision as a single legal entity. Applications from current members were open from January 1, the same day the organization was officially launched, and the New SRO said in an emailed statement that there was “strong interest” from member companies.
“Several individuals have expressed interest in applying and are at various stages of the process,” the statement read. Because some companies have “internal planning and preparations for completion” in advance of submitting an application, the New SRO said it expects applications to be submitted continuously “over the next several years.”
While iA Financial’s application is being approved, the wealth firm is working on a “one wealth, four door” strategy that will provide advisors and clients with greater flexibility. Bourbonnais said the company wants to be a “first mover,” reflecting the new environment and serving advisors.
“The way I see it (the idea) is to combine four wealth companies (iA Financial),” he explained, noting that it otherwise largely continues the mandate of predecessor Sean O’Brien, whose overall goal was to attract talent to each division. (Bourbonnais will remain as CEO of iA Private Wealth “for at least one year” and there will be continuity, he said, as the search for a president of that division continues.)
“The timing and opportunities (with this appointment) are very much tied to the New SRO,” Bourbonnais said. “We have the size and scale and that’s what we want to promote,” alongside clear branding and operational efficiency.
Louis H. DeConinck, president of Investia, agreed that it is time to stop viewing iA Financial as many different companies with separate assets. He called the company a “powerhouse” designed for independent advisors. “This is 150% good news,” he said. “We are well positioned for future growth.”
The company confirmed in an email that iA Private Wealth has $47 billion in assets under management, while Investia has $56 billion, for a total of $103 billion as of Jan. 31. Including its dealers, iA Financial Group has assets under management of $196.2. billion.
For now, iA Private Wealth Advisors and Investia Financial will operate under separate banners, but the company is actively talking to them about where management would like to take the organization.
“How is yet to be determined; we need to work with regulators on this,” Bourbonnais said.
The ultimate goal, Bourbonnais explained, is to “ensure (through harmonization) that advisors joining us and clients joining us can seamlessly transition from one (department) to the other” through a seamless transition process, and when their advice is needed . the expectations and needs of the portfolio change.
At the same time, while respecting the company’s “entrepreneurial advisor” business models, it wants to improve aspects such as some of the basic technological tools used by advisors, which will result in greater transparency of iA Financial’s wealth offering.
An ongoing element that will help is an ongoing “significant digital transformation project” across all divisions. “(This is a space) where we need to lead more than ever” to meet people’s counseling needs, Bourbonnais said.
This digital plan, which Bourbonnais will continue to oversee while remaining CEO of iA Private Wealth, supports the hybrid advisor through a plug-and-play ecosystem under development. It will provide advisors with a large selection of business and planning tools, advanced predictive analytics and a platform for advisors with configurable business filters called AX360.
The company is also focused on growing its Canadian-registered investment advisor for cross-border clients, iA Private Wealth (USA) Inc., and is exploring unified managed account (UMA) and investment advisor portfolio management (ICPM) opportunities.
This dual registration development is the latest of several changes that have occurred since iA Financial purchased HollisWealth from Bank of Nova Scotia in 2017. The company launched its iA Private Wealth brand in January 2021, uniting iA Securities and HollisWealth , leaving the funds of mutual funds as separate. Shortly thereafter on July 1 of this year, FundEX Investments Inc. merged with its sister company Investia Financial.
On Tuesday, iA Financial Group released its earnings report for the fourth quarter, which ended on December 31. Diluted earnings per share were $2.17, up 12% year-over-year. Net income attributable to common stockholders was $229 million, up 10% year-over-year.
Total assets under management and administration as of December 31 were $200.4 billion, down 9% from $221 billion in the prior year, amid challenging market conditions.
In the individual wealth management space, sales totaled $6.8 billion in 2022, down 22% from $8.8 billion a year earlier. Data from Investor Economics shows that the company ranked first in Canada in terms of sales of separated funds (net sales were $1.9 billion) and third in terms of assets, according to management discussions and analysis.
