Five things you need to know this week - 29 July

By Drew Meredith

1. Among the most popular and divisive topics across financial markets, this week has been the use and valuation of unlisted assets by?industry funds. The lightning rod has been tech unicorn Canva, which had seemingly avoided any impact from the 25 per cent drop thus far this year. Several funds have highlighted their preference for ‘expertly valued’ unlisted companies over listed assets, but news that Blackbird Ventures had cut its valuation by more than 30 per cent will force the likes of Host Plus to update its valuations. Interestingly this comes after the comparatively strong end of financial year returns has already been posted, raising concerns about member equity.?
2. There are few companies that play as important a role for financial advisers as IRESS, which owns and operates the XPLAN platform. The sheer dominance of XPLAN as the primary CRM and Portfolio Management system is unprecedented, despite clear challenges in constantly evolving the product for a fast-changing group of users. News this week that long-standing CEO Andrew Walsh would depart the company comes at an important time as the group seeks to switch to more of a platform model
3. The corporate regulator released a six-monthly update on enforcements within the financial sector, with advice related to misconduct enforcement activities second only to credit misconduct. Among the high(or low) lights was ASIC’s first successful case against an accused ‘pump and dump’ investor that was using message boards to influence share prices. The regulator managed to extract some $145 million in civil penalties for a variety of breaches, with financial advice cases representing 14 of the 54 completed actions. 31 individuals were removed from financial and credit advice registers.?
4. Australia's largest network of financial advisers, Insignia, is hopeful that the trend of losing advisers is set to end in 2023 after losing another 82 in the financial year. The group continues to license 1,600 individuals, with the key driver of recent losses being 43 self-employed advisers leaving the IFL stable and 30 departing amid the MLC / Bridges acquisitions and restructure. Centrepoint Alliance was able to add 175 advisers via its merger with ClearView, with some 192 self-licensed firms representing 788 individual advisers representing an increase of 9 over the last 12 months. Insurance advisory firm Certe announced the acquisition of Genesis Financial Partners, resulting in a team of 9 advisers that are set to further diversify their insurance and employee benefits business into typical advice.?
5. The new financial year has begun on an aggressive note for the regulator, with the first so-called “stop order” issued under the maligned Design and Distribution Obligations laws. ASIC has placed an interim stop order on two UGC Global Group companies which had reportedly been offering loan-like investing into a fund whose only asset was a loan to a related part for the purpose of developing a sandstone quarry. There were concerns that it was a high-risk investment, not necessarily aligned with the investors it was targeted toward with the regulator noting that “the return of an investor's funds and any interest payable under the loan is wholly dependent on the related-party borrower's ability to repay the loan" as a key reason behind the decision.