by David Chaplin
Asteron took over Stone late in 2004 after the advisory firm racked up a significant debt with the insurance firm. According to Stone’s 2005 financial statements, Asteron injected about $1.4 million in December 2004 and assumed control of the group.
It is understood Asteron has had to prop up Stone since its takeover with further cash payments.
However, Franks told Good Returns that after streamlining its cost base and introducing new adviser agreements and back office systems, Stone has turned the corner.
In a statement released yesterday, Sean Carroll, head of Asteron parent company Suncorp Wealth Management NZ, said “radical change” was needed to keep Stone relevant in a rapidly-consolidating industry.
Carroll said the aim was to develop Stone into “into one of New Zealand’s leading independent distribution businesses”.
Franks said under the upgraded agreements, Stone’s 22 advisers have retained full independence and secured better terms, including some ownership of renewal streams.
Stone adviser would also have access to the RMS InControl software package.
He said the group also has referral relationships with 23 other advisory businesses, which would be offered the opportunity to formally join Stone or enter an agreement to use its back-office services.
Franks, who also developed the business structure of the Share group, said Stone would be one of the “half a dozen or so” risk advisory networks to flourish in the new regulatory environment.
As part of Stone’s makeover a new four-person board has been appointed comprising: Carroll; Antony Vriens, head of Asteron NZ; Terry Tidbury, Suncorp NZ chief financial officer, and; Malcolm Powell, a long-time Stone adviser. Carroll said Stone would soon appoint a general manager and distribution support person.
“Further parts of the plan are under wraps until those appointments are in place, but promise to have more significant impact on the sector,” he said in the statement.
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