Compensation comes from paid commissions for selling products like stocks, bonds, mutual funds and annuities. There is a potential for conflict of interest because an adviser can make more money for him or herself by placing clients' assets into investments that pay higher commissions. They have an incentive to make you money, because if your assets grow, so does their fee. The investor is still responsible for internal fees charged by mutual fund companies. The adviser charges you a fee for consultation, but it is offset by any commissions.
Commissions pose a potential conflict of interest.
This doesn't mean that the person isn't interested in selling you high commission products. On the contrary, often advisers in the bank receive bonuses or are promoted based on the number products they sell. I have found that advisers that work in banks and credit unions usually have the least experience. Many people go to their banks intending to buy CDs and get stuck with annuities and other high-commission products. These products are not FDIC insured and just like other investments, they are subject to markets ups and downs.