The 2018 Financial Advice report by Investment Trends has revealed that over the last 12 months, trust levels have fallen most severely for banks and financial planners to below five out of 10, and into the “distrusted” range.
Banks fell from a trust rating of 5.5 to 4.8, while financial planners fell from 5.1 to 4.8. On the other hand, accountants had a trust rating of 5.7, down slightly from 5.8 in 2017.
“So far, the general sentiment has not been positive,” said King Loong Choi, senior analyst at Investment Trends.
“More than 40 per cent of Australians do not believe that the financial services and banking industry has met its obligations to everyday Australians, while half reject the notion that the industry has been treated unfairly in the media.
“The trust impact of the royal commission is real, and the financial advice industry must take proactive measures to rebuild trust among the wider population,”
In September, the royal commission released its interim report, following months of spectacular findings including fee for no service, charging fees to dead people, and inappropriate loan advice with devastating consequences.
The final report from the commission is due 1 February and will include the topics of the fifth, sixth and seventh rounds of hearings, which focus on superannuation, insurance and policy questions arising from the first six rounds, respectively.
Despite this research from Investment Trends, reports to the contrary are being released from banks and financial services institutions.
Research released last month by insurer MetLife Australia found that Australians who possessed an established relationship with a chosen adviser indicate the royal commission will have no impact on their arrangements.
56 per cent of consumers who responded said that the royal commission would not affect their advice relationship, while 20 per cent of those who had advisers said it would make them even more likely to visit their selected expert.
Alongside this, findings from Roy Morgan's Customer Satisfaction-Consumer Banking in Australia August Report showed that not all banks have suffered a decline in satisfaction due to the royal commission, with ING satisfaction rate at 88.8 per cent and Bendigo Bank's at 88.4 per cent.