Cetera Financial Group reels in $5 billion in assets to start 2019

Chairman says management is 'rock solid' despite the departure of CEO Robert Moore

Feb 28, 2019 @ 2:41 pm

By Bruce Kelly

As it deals with turnover at the top of its management ranks, Cetera Financial Group is on pace to recruit advisers with $5 billion in client assets over the first two months of the year, according to senior Cetera executives.

Cetera Financial's recruiting was "a record first two months of the year for us," said Adam Antoniades, the firm's president. "The pipeline was built up, and now we are converting those advisers."

Most significantly, Cetera Financial said this week that the wealth management group of North Ridge Securities Corp. of Melville, N.Y., is shutting down and would now work under Cetera Advisor Networks, the network's broker-dealer that works with large offices.

North Ridge Wealth Planning has over $2.5 billion in client assets and 85 affiliated advisers, accounting for close to half the assets the firm has recruited at the start of 2019.

North Ridge Securities reported $15.3 million in revenue in fiscal 2018, according to a filing with the Securities and Exchange Commission. Terms of the acquisition were not released.

Cetera Financial's ability to recruit North Ridge comes as the firm's CEO, Robert Moore, said last week that he was stepping down at the end of March due to health reasons. At the time, some in the industry said Mr. Moore's departure was a likely signal of further changes ahead, including a cutback in staff. Cetera Financial is comprised of six broker-dealers and roughly 8,000 registered reps and financial advisers.

"The management team is rock solid," said Ben Brigeman, Cetera's chairman who will be taking over temporarily as CEO during the firm's search for a new CEO. Mr. Brigeman is also a member of the strategic advisory board of Genstar Capital, the private equity manager that bought Cetera Financial Group last summer for $1.7 billion.

"We remain extremely excited about the future of Cetera," said Mr. Brigeman. Mr. Moore "had to take care of himself and his family and leaves the organization in a very good spot."

He said that Cetera saw a significant opportunity to invest in technology, which some Cetera advisers had recently questioned. Cetera this week is beginning to roll out a new platform with financial planning and other capabilities, and plans to add to that three different times over the year.

One Cetera adviser, who asked not to be named, was heartened by the introduction of the tech.

"A piece by piece roll out is the most prudent way to do it," said the adviser. "You roll out one piece, and when that works, introduce the next."

A network of broker-dealers that focus on a variety of business models for advisers, Cetera Financial Group in the past has executed on its strategy of absorbing small to mid-sized broker-dealers and turning them into separate branches and offices.

In August 2017, Girard Securities, which was owned by Cetera Financial and had about 200 advisers, said it was shutting down and being absorbed by Cetera Advisor Networks, another of Cetera Financial's broker-dealers, but keeping its brand and becoming its own independent branch.

Meanwhile, Cetera Financial on Thursday morning said that Rogue Credit Union's Investment Services, which works with over $181 million in client assets, has joined Cetera Financial Institutions, its broker-dealer that works with advisers at banks and credit unions.

Meanwhile, Cetera is searching for a replacement for Mr. Moore.

"Foremost in our mind is the need to find a candidate capable of supporting Genstar's long term philosophy and track record of fueling growth within its portfolio companies," Mr. Brigeman said.

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