The net head count of financial advisers at Wells Fargo Advisors, which has seen thousands of financial advisers leave for competitors or retire since the 2016 scandals at parent bank Wells Fargo & Co., showed signs of stabilizing during the second quarter, with a net decrease of 66, or less than 1%, when compared to the end of March.
At the end of June, Wells Fargo Advisors reported a total of 12,184 financial advisers, compared to 12,250 three months earlier, according to the firm's earnings report, which was released Friday morning.
While the year-over-year total of financial advisers declined 5%, a good portion of that total can be attributed to Wells Fargo Advisors losing hundreds of financial advisers when it said last year it would no longer work with international clients, which caused many advisers to leave the firm.
While the firm is keeping mum on the total number of financial advisers it hired during the quarter, there are indications that Wells Fargo's focus on hiring more experienced financial advisers with wealthy clients is taking hold. For example, annualized revenue per financial adviser was actually slightly higher at the end of June, at $1.21 million, compared to the end of last year, when it was $1.17 million, according to the company.
That 3.6% increase in annualized revenue per adviser at Wells Fargo Advisors came at an awful time for the broad market, with the S&P 500 posting a decline of 20.6% during the first half on global economic reports of inflation, fears of a recession and consternation over Russia's invasion of Ukraine in the winter.
Change is clearly afoot at Wells Fargo Advisors, but how big an impact new executives and changes in the firm's practices have on financial advisers remains to be seen. In May, Jim Hays, the head of Wells Fargo Advisors, said that he was retiring. Weeks later, David Kowach, who headed Wells Fargo Advisors until 2019 and was Hays' predecessor, also announced his retirement. Most recently, he was “head of affluent” at Wells Fargo, according to his LinkedIn page.
Sol Gindi, a veteran of JPMorgan Chase, replaced Hays as head of Wells Fargo Advisors and head of the Wealth & Investment Management Client Relationship Group. In another measure to focus on its independent brokerage operations, the firm last month said it was rolling out a new, special bonus for current Wells Fargo advisers who are employees and want to move to its independent contractor brokerage, Wells Fargo Advisors Financial Network, or FiNet.
"We had our best recruiting quarter since 2016," a company spokesperson said, although she declined to give specific data. "We have more than doubled the number of $1 million-and-more financial adviser producers year-over-year and have made strong headway in all of our channels."
"Improved hiring is driven by our ongoing focus on a strong recruiting pipeline, and an increased focus by the new management team on growing across all channels," the spokesperson added.
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