Displaying items by tag: wealth management

Raymond James CEO Paul Reilly was optimistic about efforts to close broker recruitment deals before year-end on its recent earnings call. In total, Raymond James only added 31 brokers in its Private Client Group, while it lost 24 brokers in its independent channel. 

The firm saw a 15% increase in assets to $1.3 trillion, although net new assets declined to $14.2 billion from $20.2 billion. Its Private Client Group segment saw a 29% increase in profit and a 13% jump in revenue. 

Earlier this month, Raymond James completed a deal for a group of 27 advisors managing $3 billion in assets away from Cetera Investment Services. The company also set aside $55 million for an SEC probe into off-channel communications. Similarly, rival firms like Stifel and Ameriprise also revealed similar amounts it was setting aside. 

Ameriprise also shared Raymond James’ optimistic assessment of recruiting despite a seasonal slowdown on its earnings call. It added 64 brokers but saw total headcount decline by 2%. But the company believes trends are positive and that there should be more additions into year-end. 

Ameriprise saw a 13% increase in revenue and a 23% increase in pretax profits. Assets increased by 15% to $816 billion while net new additions dropped 20% to $8.9 billion from $11.2 billion. 

Finsum: Raymond James and Ameriprise both noted a seasonal slowdown in recruitment but believe that activity should pick up into year-end. 

Financial advisors intuitively grasp the importance of planning to help their clients reach their financial goals. As business owners, advisors need to apply the same principles with succession planning to maximize the value of their practice. A succession plan should provide a contingency plan for unforeseen circumstances in addition to detailing how the practice will transition in the future. Here are some common mistakes to avoid.

The first mistake is to not have a proper understanding of the value of your practice. This includes financial as well as other considerations such as the impact on your clients, the organizational structure of your firm, and how the firm will function without you.

Another mistake is to be unclear clear about your needs and wants in order to determine the ideal successor. With this selection, it’s important to find alignment in terms of investment philosophy, location, mission statement, and how they will continue to serve your clients effectively.  

Many advisors also err by not sharing their succession plan with key stakeholders like employees, clients, family members, etc. Rather, the succession plan and any iterations should be shared with everyone to ensure that there is no lack of clarity. It can also help with client retention and recruitment. 

Finsum: Succession planning is quite important for financial advisors for several reasons. Here are some mistakes to avoid. 

A well-crafted value proposition details how your services will solve client’s problems and improve their financial situation, what benefits it will deliver, and why your target prospect should choose you over a competitor. Defining this value proposition can help improve your odds of success in recruitment and operating your practice. It can also help you build trust with clients. 

An important step in the process is to determine your ideal client profile. Some characteristics to consider are their financial goals, challenges, and demographics. This will help you decide how to serve these clients, to address their needs and differentiate yourself from competitors.

Value propositions are necessary in an industry where success is based on trust and relationships. Some things to avoid are complicated language, a lack of focus on clients, and not sufficiently identifying what makes your services unique. 

Lastly, value propositions should be updated regularly to reflect changes in the practice, industry, and your clients. It should continue to highlight your value and uniqueness while remaining relevant in terms of addressing your clients’ pain points. 

Finsum: Defining your unique value proposition can help your firm attract clients and refine its purpose. Here’s how to get started. 

The steady stream of brokers exiting Merrill Lynch continues as the Ruccio Group, based in Miami and managing $1.37 billion, left for RBC Wealth Management. The team is led by Jeremy J. Ruccio and is composed of 2 advisors and 6 client associates. 

In a statement, Ruccio attributed the decision to wanting to retain the group’s personalized attention and smaller firm feel with the resources, leverage, and insights of a global financial institution. Ruccio started at Merrill Lynch in 2008 and was ranked #24 on Forbes’ best in state wealth advisors list this year and #29th on the America’s best next generation wealth advisors list in 2021.

Currently, RBC has around 2,100 brokers and has $544 billion in client assets. Although its wealth management division is smaller than many of its peers, it’s had success in recent years luring brokers from larger firms. To compare, Merril Lynch and parent company, Bank of America, have over 19,000 advisors across its wealth management division. 

Last week, it lured a $450 million team from Morgan Stanely which was based in Philadelphia. In September, it recruited a 41-year Merrill broker who managed $340 million in assets. In the prior month, RBC landed a UBS team based in Atlanta which had $5.5 billion in client assets and $22 million in annual revenue. 

Finsum: RBC is having success luring brokers from larger competitors. It recently landed the Ruccio Group, based in Miami which manages $1.37 billion in client assets.

Succession planning is increasingly important with the heightened pace of M&A activity and the ‘greying’ of the industry. It can ensure the smooth transfer of clients, assets, and responsibilities when an advisor retires. 

The process entails identifying who is best qualified to be your successor, ensuring clients concerns are addressed, and regulations are followed. The goal is to ensure that the business continues operating without interruption while preserving the value of the practice.

In terms of identifying potential successors, it’s important to determine whether there is the right alignment with the firm’s values, vision, and approach towards clients in addition to the proper experience, knowledge, and skills. They must also possess some leadership ability as they will have to make important decisions and lead the firm. Finally, these attributes can be developed through mentoring and guidance. 

Another element is maximizing client satisfaction and retention through the process. This can be done by introducing the new advisor to clients well in advance and working in tandem for some period before fully shifting responsibilities. It’s also important to stay in regular communication with all stakeholders during the process including clients, employees, and other partners. 

Finsum: Succession planning is increasingly important due to the ‘greying’ of the industry and increase in M&A activity. Here are some important considerations.