The number of appointed representatives (ARs) across the main networks prevalent in mortgages increased by 110 in Q4 2023, the latest Network League Table has found.

The number of AR firms leaving networks stood at 1,070, while 1,077 joined, the study, completed in early January, reveals.

Paul Day, founder of Network Consulting, which produces the study based on the FCA regiester, says the figures suggest that Q4 “experienced an influx of new firms joining networks, rather than just moving from one to another.”

“When we produced these figures for Q1 2023, there was 99 more firms leaving than joining networks, so what can we draw from the Q4 uplift?,” asks Day.

“Perhaps there is a transition of some firms from Direct Authorisation (DA) to AR status, or that there are advisers leaving larger practices joining a network and setting up their own AR firm.

“Regardless of the reason, it has to be seen as a positive statistic which will hopefully develop into a trend throughout 2024.”

Day points out that the league table is produced to the monitor the movement of AR firms and should not be used as a metric by which brokers should choose a network but adds that 2Plan stood out in the 2023 report for adding 105 new AR firms, with “an impressive increase of 78 new firms net in final quarter of the year.”

“The biggest talking point in 2023 across networks, was obviously the announcement by Tenet Group (experiencing a net loss of 305 AR firms since the end of 2018) of the sale of its network brands,” Day adds.

“TenetConnect, TenetConnect Services are primarily wealth networks, and TenetLime is their dedicated mortgage network.

“The wealth firm are being sold to Openwork and 2Plan, while TenetLime is being sold to Primis. So, one could be excused for thinking that 2Plan’s AR growth in 2023 may be a result of the Tenet sale, however, only 18 of the 78 they appointed in Q4 came from Tenet.”

Despite the imminent closure of the sale of Tenet, the FCA register shows that Tenet appointed 24 firms in 2023, 21 in Q4.

However, Day explains these firms have just been dual authorised, moving from other Tenet brands to TenetLime. This is likely to be firms that only deal in mortgages and protection, he says, and are being moved in preparation for the transition from TenetLime to Primis.

“It is important to note that the table takes account of any dual authorisations by removing them, only counting each firm once,” says Day.

“It’s possible that there may be further consolidation, in fact some commentators believe it to be inevitable. Conversely there is talk of growth and even emergence of new smaller networks, giving financial advisory professionals choice, which would surely be a good thing.”

Both TMG and Cornerstone experienced 67.2% and 43.8% net increase respectively. Other networks enjoying growth were Stonebridge, HLP and Beneficial, while there was a sizeable loss in AR numbers for Envelop network.

Day explains that future network league tables will only include networks that have 20 or more AR firms, therefore Sandringham and Envelop will not appear.

The study is based on the FCA definition of a network, which outlines that to be classed as a network, a principal firm:

•  has five or more appointed representatives (not counting introducer appointed representatives); or
• whose appointed representatives, not counting introducer appointed representatives (and being fewer than five) have, between them, 26 or more representatives

Introducer Appointed Representatives are excluded from the study.

See full table below (scroll for further columns):