Top exec predicts record recruiting year

Raymond James Financial Services Inc. expects a record recruiting year, as reps and advisers flee struggling wirehouses to join the St. Petersburg, Fla.-based company. In the first five months of the company’s fiscal 2009, beginning Oct. 1, Raymond James’ independent broker-dealer arm has seen a 251% increase over fiscal 2008 in the number of brokers who have joined or have committed to joining the firm. (Raymond James does not divulge the head count of brokers and advisers it recruits, but it says it is snagging big producers.) And at this year’s meeting of advisers being held this week in Las Vegas, there are 105 prospects, compared to just 56 potential recruits at last year’s meeting, executives told InvestmentNews. The chaos in the marketplace has worked to Raymond James’ advantage, the executives said. Advisers from wirehouses, especially Merrill Lynch & Co. Inc. of New York, feel let down, explained Jim Fulp, executive vice president and managing director at Raymond James. “They really feel betrayed. They are angry. They’re looking for a place where they can once again relax and say, ‘I don’t have to worry about the company.’” “One of the things that’s different about this period for us is, we’re getting to talk to people who were not looking for change,” said Richard G. Averitt III, chairman and chief executive of Raymond James Financial Services. “These are people who weren’t out looking around, he added. “Recruiting clearly has blossomed. We are talking to bigger producers who are just disappointed with the way things have turned out for them.” Last year, average production for recruits was about $300,000 of fees and commissions, executives said. This year, that number has increased to $550,000. Unless the right deal comes along, the firm is not likely to make an acquisition, Mr. Averitt said. Such acquisitions can prove to be too messy in a market where recruiting individuals or groups of advisers is proving so fruitful, he said. Raymond James Financial has more than 5,000 reps and advisers on its various platforms and $170 billion in client assets at the end of December. Raymond James Financial Services represents the largest group of brokers in the firm.