LPL crosses 20,000 adviser head count, probes small-firm M&A market

LPL Financial Holdings Inc. reported Thursday that it had reached the milestone of having more than 20,000 financial advisers working and registered across its varied platforms, and the firm's senior management reiterated that LPL was keeping its eye on both internal and external growth opportunities.

LPL Financial has been an acquisition machine for years when it comes to large firms. Most recently, in 2021, it completed its purchase of financial advisers from Waddell & Reed Financial Inc.

While LPL is primarily focused on internal or "organic" growth in the ranks of its financial advisers, it remains aware of the market for potential mergers and acquisitions involving smaller broker-dealers and registered investment advisers, CEO Dan Arnold said Thursday afternoon in a conference call with analysts to discuss the firm's first-quarter earnings.

"When you look at M&A as a complement to that organic growth, we’re constantly looking across the landscape," Arnold said.

"It’s smaller broker-dealers and RIAs that may be an opportunity and interesting perspective to support our overall growth agenda," he said, adding that the challenging financial markets recently create opportunities to make such deals.

Meanwhile, LPL Financial reported that its financial adviser head count was 20,091 at the end of March. That's an increase of 2,419, or 13.7%, compared to the same time a year earlier and a rise of 215, or 1.1%, from the end of December.

A big chunk of the advisers new to LPL came from the Waddell & Reed deal. LPL acquired the majority of the 920 advisers registered with Waddell & Reed at the time of the deal.

LPL reported that its recruited assets for the quarter were $10 billion, and for the trailing twelve months $76 billion, up approximately 34% from the same time in 2021.

Annualized advisory fees and commissions per adviser for the quarter were $327,000, which compared to $293,000 at the end of March 2021, an increase of 11.6%.