Raymond James' Elwyn downplays acquisitions

Raymond James Financial Inc. is undeterred by the recent flurry of mergers and acquisitions in the independent broker-dealer business and is standing by organic growth, Tash Elwyn, chief executive of the firm's employee adviser channel, said in an interview at the firm's annual conference in Orlando, Fla. The firm, which has about 2,500 advisers in the employee brokerage unit, Raymond James & Associates Inc., does not have growth targets and is staying focused on one-off hires from large brokerage firms, Mr. Elwyn said. That's despite recent moves by competitors such as Stifel Financial Corp., which agreed to buy the assets of Barclays Plc.'s U.S. wealth management group in June and acquired the Sterne Agee Group earlier this year. “Stifel has had a considerable focus on [acquisitions] and obviously to an extent are serial acquirers,” Mr. Elwyn said. “And I say this respectfully, that's a very different business model than ours. I wish them great success with it, but our focus is on retention and selective growth.” In contrast to Stifel, which has about 2,100 advisers, Raymond James completed only one major deal in recent years with the acquisition of Morgan Keegan & Co. Inc. in 2012, and has otherwise been hesitant to make subsequent deals despite the success of that merger. DOOR STILL OPEN Mr. Elwyn said the firm was still open to acquisitions if the right deal came along, of course, but when asked whether he sees any specific opportunities in the broker-dealer space right now, he demurred. “What I see is a near infinite opportunity today — and I don't see it closing — for us to be continuously successful in attracting advisers from other firms,” he said. “And that focus is on recruitment of one adviser [at a time].” Mr. Elwyn said the firm has seen recruitment of wirehouse advisers “accelerate” in the past two years and attributed the growth in part to publicity about their earlier hires and dissatisfaction of brokers at large wirehouse firms. He said annual changes to compensation and “continual turnover in branch management leadership” were weighing on morale of brokers at large firms. “All too often I hear things like, 'The best thing I can say about my branch manager is that he or she leaves me alone,'” Mr. Elwyn said. “And to the other extreme, I hear things like, 'I like my branch manager but he or she has been neutered and can't make business decisions.'” Mr. Elwyn declined to provide a goal for the number of advisers he would like to see in the employee channel. “I've seen time and time again when you set numbers you put quantitative decision ahead of qualitative,” he said.