Morgan Stanley palms off clients with less than $1m to Ord Minnett
Morgan Stanley Wealth Management wants to focus on Australia’s wealthiest individuals, with stockbroker Ord Minnett to take on the bank’s less-wealthy clients.
Clients with less than $1 million in assets who seldom seek Morgan Stanley’s wealth management services will have the option to move their accounts to Ord Minnett, as the US firm prioritises high-net-worth accounts, not-for-profits and family office money, people familiar with the proceedings told The Australian Financial Review.
Morgan Stanley was saddled with some inactive wealth management clients having less than $1 million, prompting a review of the business, the people said. The costs and time involved in conducting Know Your Customer and Anti-Money Laundering diligence on these accounts outweigh the returns, leaving its advisers with less time to focus on wealthier clients.
The US wealth manager told its 103-person team of financial advisers in Australia about the review this week, the people familiar with the process said. Morgan Stanley will now begin notifying clients who can move their accounts to Ord Minnett.
“We are focused on providing a truly global, best-in-class offering for [high-net-worth], [ultra-high-net-worth] and not-for-profit clients in Australia” a spokesman for Morgan Stanley said.
He said Morgan Stanley started a formal review of this process on Wednesday, and that it would “take several weeks” to finalise.
“Clients who are impacted will be contacted once this review is completed and will be offered alternative solutions where appropriate,” he said.
The proposal to hive off its less-wealthy clients was first revealed by the Financial Review’s Street Talk column last month.
The framework with Ord Minnett does not comprise selling any
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