There’s no doubt that any firm’s ideal advisor is one who brings home the bacon.
“From a business point of view, an ideal advisor is someone who makes you a lot of money,” says Bob Larose, vice president of private client services for Vancouver-based Canaccord Capital Inc.

But it’s not just about dollar power. The most sought-after advisors — across the board — are certified financial planners with solid entrepreneurial skills and multiple licences. Rookies need not apply.

The CFP remains the designation of choice in the financial services industry, with 39% of the 1,430 advisors surveyed in this year’s Report Cards holding the designation. It’s a clear case of supply meeting demand.

“I believe the industry as a whole is moving toward making the CFP a mandatory requirement,” says Steve Cole, national sales manager at Laurentian Financial Services in Toronto. He says 65% of the firm’s planners either hold the CFP designation or are working toward it. Winnipeg-based Investors Group Inc. and Partners in Planning Financial Services Ltd. of Regina have made the CFP mandatory.

It’s no surprise advisors at the mutual fund dealers lead the ranks when it comes to holding or working toward the CFP: 49% of planners surveyed by Investment Executive hold the designation. But insurance advisors and bankers aren’t far behind: 40% of insurance advisors surveyed hold a CFP, while 43% of bankers have a CFP.

The numbers taper off for brokers: 27% of those surveyed have their CFP, although 19% hold the personal financial planner (PFP) and 19% have the Canadian investment manager (CIM) designations

Despite its status as the gold standard of designations, the CFP alone will not open every door. In an industry that’s largely sink or swim, entrepreneurial spirit is also desirable.
“We want people who work well in a fiercely independent culture,” says Terry Hetherington, national sales manager for Vancouver-based Raymond James Ltd.

Indeed, entrepreneurs are in heavy demand at almost every investment dealer, mutual fund dealer and insurance firm IE surveyed.

“We want business entrepreneurs who are looking for a franchise infrastructure,” says Jim Wingrove, director of the agency department for Guelph, Ont.-based The Co-operators Group Ltd.

“This isn’t a salary position in which someone can show up and hope that life presents opportunities for them,” seconds Kevin Regan, executive vice president of financial services at Investors Group.

There’s also not a lot of room for hesitation. “It’s a case of ‘here’s the diving board; now jump’,” says a Canaccord advisor from Vancouver.

It’s a different story at the banks, at which a team approach — as opposed to an entrepreneurial bent — is promoted among the largely salaried workforce. “Our people have to enjoy contributing to the results of the team,” says Wendy Hannam, executive vice president of domestic branch banking for Toronto-based Bank of Nova Scotia.

It’s also the banks and the insurance companies that speak loudest about customer service skills. “Our ideal candidate has to be a people person, first and foremost,” says Anne Lockie, head of sales for personal and business clients at RBC Financial Group in Toronto.

Required: client focus

“Some excellent business people have come to us, and we’ve turned them away because we didn’t see their customer focus,” says Derek Fee, senior public affairs specialist for State Farm Canada in Toronto.

Whether an entrepreneur or a team player, almost every firm’s dream candidate holds multiple licences. Out of the advisors surveyed in the 2005 Report Cards, 70% hold an insurance licence and 83% have a mutual fund licence. And as the industry as a whole moves even further toward wealth management, those numbers are set to rise even higher, as are the number of advisors holdings securities licences.

“Insurance is going to become a larger piece of our business,” says David Agnew, national director at RBC Dominion Securities Inc. in Toronto. Assante Corp. advisors have already made the leap. “We don’t require an insurance licence, but 90% of our guys have one,” says Joseph Canavan, chairman and CEO of Toronto-based Assante. Overall, 88% of planners and 9% of account managers surveyed hold insurance licences, as do 69% of brokers.

Advisors without mutual fund licences are few and far between, even among insurance agents. In total, 80% of all insurance advisors surveyed by IE have mutual fund licences, as do 95% of financial planners, 88% of account managers and 72% of brokers.

@page_break@Mutual fund licences are mandatory at London, Ont.-based Freedom 55 Financial, and held by the majority of insurance advisors elsewhere. “Eighty-five per cent of agents are mutual fund-licensed,” says State Farm’s Fee. Over at Waterloo, Ont.-based Clarica Financial Services Inc. , 75% of advisors can sell funds, as can one-third of the sales force at The Co-operators. Most unlicensed advisors are in their twilight years. “We have a
small number of older agents who have chosen not to get their mutual fund licenses,” Fee says.

While designations and multiple licences are high in demand, at the end of the day an ideal advisor has to draw in the dollars. And most firms aren’t shy about spelling out exactly what they’re looking for on the balance sheet. “Someone with one to three years in the business should have around $20 million in assets,” says RBC DS’s Agnew.

Over at Toronto-based TD Waterhouse Private Investment Advice, average book size is $75 million, which works out to $675,000- $750,000 in annual revenue. “We’re looking toward the $100-million book, which I think is what it will take to be in this business going forward,” says Dave Pickett, TD’s head of practice management.

Wellington West Capital Inc. of Winnipeg expects a minimum book of $50 million, with $400,000-$500,000 in annual revenue, while ScotiaMcLeod of Toronto will consider advisors with less than $500,000 in revenue, provided core clients have more than $100,000 in assets. Canaccord brokers are expected to bring in $6 million in new assets during the first year and each of the following five years.

In the mutual fund dealer world, Assante’s price of admission is among the highest. “Our written agenda is that we will not recruit advisors with less than $20 million in assets,” Canavan says. “The average advisor we’re targeting has a book of $25 million-$35 million.”

The bar is slightly lower at Montreal-based Peak Financial Group. “Our minimum is $10 million in AUM, but our ideal is $20 million-$25 million,” says president and CEO Robert Frances. Laurentian and IQON Financial Inc. of Winnipeg also target advisors with $10 million or more in AUM.

And while a bigger book size doesn’t translate into a better profit for Markham, Ont.-based FundEx Investments Inc. — which charges its advisors an annual flat fee of $18,000 — it’s a matter of mathematics. “A planner would have to have a $12-million book for it to make financial sense to come here,” says David Vowles, president and CEO.

Most banks and insurance agencies remained mum on book size. Don Rolfe, president and CEO of Vancouver-based Credential Financial Inc. — the wealth-management arm of Canada’s credit unions — won’t name a number, but says advisors at Canada’s credit unions are expected to grow their books by 10%-15% annually.

Winnipeg-based Great-West Life Assurance Co. , says its agents must have an annual income of $105,000 or more. At Freedom 55, agents must strive for a product mix of 60% investment products and 40% insurance. “We benchmark advisors at $125,000 and upward in earnings,” says senior vice president Nick Pszeniczny.

That said, an ideal advisor is far more than a money-making machine. “In actuality, it’s someone who does good business for their clients,” says Canaccord’s Larose. IE