RCS Capital Corp. is beginning to tie together its nine disparate retail broker-dealers, and on Tuesday morning said it will offer services from one broker-dealer across the various platforms of the others.
Included in those changes will be combining due diligence and research groups at the start of next month, said Larry Roth, chief executive of Cetera Financial Group, which has replaced RCAP Retail Advice Division as the official moniker of the broker-dealer network.
RCS Capital Corp., known by its ticker symbol RCAP, has two main lines of business: wholesalers who distribute nontraded real estate investment trusts and other alternative investments and its network of retail advisers. Under Cetera Financial Group are nine different broker-dealers with 9,200 affiliated registered reps and advisers.
Last week, RCAP
said it had agreed to buy a 10th firm, VSR Financial Services Inc., with about 260 reps and advisers.
Mr. Roth said Cetera Financial Group was not anticipating any layoffs as it combined the various business groups.
“This is not about cost-cutting,” he said. “We're taking the best of Cetera Financial Group and rolling that out to advisers at the other broker-dealers.”
(More: Larry Roth: Defining the next 10 years for independent broker-dealers)
The Cetera network
was purchased this year by RCAP, whose executive chairman Nicholas Schorsch over the past 14 months has led the network's aggressive expansion into the retail advice business.
Cetera had previously integrated many of its back-office functions, Mr. Roth noted. “Cetera Financial Group has been operating as one entity with four broker-dealer brands. We've already integrated technology, finance and other functions there, so Cetera Financial Group is fully integrated.”
The four Cetera broker-dealers and those advisers who are affiliated with another broker-dealer, First Allied Securities, account for almost 90% of the network's headcount, Mr. Roth said. “The integration is more of a cross-pollination of what is already in place at Cetera Financial Group and First Allied,” he said.
The integration will be completed before the end of the year, he said.
(More: RCAP, Pershing locked in negotiations over clearing agreement)
The new services across the Cetera Financial Group broker-dealers will include: expanded business consulting resources, including the practice management platform first launched by First Allied Securities; marketing to help advisers with practice-specific branding; and best practices in service and support from Summit Brokerage Services and Investors Capital, two other firms in the network.
