Raymond James to make a run at advisers who custody with TD

Raymond-James-targets-custody-customers-TD

Schwab’s Bernie Clark says the company expects to face “fierce competition” for small advisers

With the registered investment adviser industry still absorbing the shock of the ongoing combination of Charles Schwab and TD Ameritrade, other firms are preparing to make a run at the advisers who custody with those companies, according to industry executives and advisers.

At the top of the list is Raymond James Financial Inc., which historically has focused on employee and independent contractor broker business and not RIAs. Now it is focusing on TD advisers, according to executives and advisers.

“The Raymond James marketing people are out soliciting business,” said one adviser, who asked not to be named and uses TD as a custodian.

“Raymond James is going to try increase its presence in the RIA space,” said an industry executive, who also asked not to be named.

In November, Charles Schwab Corp. said it was buying rival TD Ameritrade Holding Corp. for $26 billion in stock. For almost 20 years, the two companies have competed to custody the assets held at RIAs.

The Schwab-TD deal, which is expected to be completed by the middle of next year, will combine more than 12,000 RIAs and more than $2.5 trillion of custody assets onto a single platform. Raymond James’ custody business is much smaller but is difficult to quantify because it did not report details of its custody business in a recent InvestmentNews survey.

While Raymond James has seen success recently in recruiting financial advisers who work as brokers or registered reps, its ability to win the custody business of financial advisers faces challenges when it comes to getting its technology up to speed, according to advisers and executives.

Last year, Raymond James hired a 20-year veteran from Charles Schwab Advisor Services, Greg Bruce, to head up its RIA group, called the Investment Advisors Division.

According to its website, Raymond James has two salespeople in its adviser division, Ray Adams in the east and Sean Martin in the west. Mr. Adams worked most recently at TD Ameritrade for nine years before leaving in September, according to his BrokerCheck profile.

A spokesperson for Raymond James did not respond to requests for an interview with Mr. Bruce.

Schwab, meanwhile, is girding for the fight. During its annual winter business update Tuesday, Bernie Clark, executive vice president of advisor services, said the company will face “fierce competition” when it comes to TD advisers and financial advisers in general with less than $100 million in client assets, the so-called small advisers.

In his remarks, Mr. Clark specifically named Raymond James and LPL Financial as two firms looking to increase their presence in that market, according to a transcript of his presentation posted on Seeking Alpha.

“And so our service level will have to remain extremely high, safety and security of course will be of paramount importance to that group of clients,” Mr. Clark said, referring to smaller RIAs. “We’ve got a lot more smart technology coming, quite honestly.”