Securities America expands in financial institutions market

IBD signs up six firms with total of $3.75B in assets; adds 15 advisers

May 16, 2013 @ 3:37 pm

By Andrew Osterland

Securities America Inc. has signed agreements with six small financial institutions to have financial advisers offer consumer investment services to bank customers and credit union members.

The six institutions, located in five different states, have a combined total of $3.75 billion in assets. Securities America, which was acquired by Ladenburg Thalmann Financial Services Inc. in 2011, now has relationships with more than 100 financial institutions with assets of approximately $72 billion. Fifteen new financial advisers will serve the six new partners.

“These services are very much in demand by banks and credit unions, and we can serve single branch locations or multiple locations across dispersed areas,” said Jim Nagengast, chief executive of Securities America. “We've expanded our resources in this market.”

WHAT TO WATCH Mint's condition: Personal finance software is now being rolled out to bank customers.

The program provides support for advisers in banks and credit unions, and gives them access to the independent broker-dealer's technology platform for performance reporting. Currently, 145 of the broker's 1,736 advisers serve the financial institutions segment. Other independent broker-dealers such as LPL Financial Holdings Inc. and Cetera Advisors LLC, as well as Raymond James Financial Inc., have a significantly bigger presence in the market. Raymond James, for example, currently has 650 advisers serving roughly 200 institutions, according to spokeswoman Anthea Penrose.

The attraction for banks and credit unions is a new source of non-interest income unrelated to their loan portfolios. It also gives them the opportunity to expand their offerings to customers and members, said Michael Anderson, who was hired to lead the division for Securities America last year. It currently represents between 5% and 6% of the brokerage's revenue.

“We think the opportunity to ramp up the growth rate in this division is significant,” Mr. Anderson said.

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