Wells Fargo & Co. and
Credit Suisse have struck a deal for Wells to recruit close to 250 advisers currently under the roof of
Credit Suisse's U.S. private bank.
Wells Fargo is not releasing the details of the recruiting package, said Emily Acquisto, a company spokeswoman.
One of the largest brokerage firms in the country,
Wells Fargo has two sides to its business: a broker-dealer where advisers are employees,
Wells Fargo Advisors, and a second which houses independent contractors,
Wells Fargo Advisors Financial Network. Both divisions are part of
Wells Fargo Wealth and Investment Management, one of the largest wealth and money managers in the United States, with $1.6 trillion in client assets.
(More: Stifel Financial in deal to buy Barclays' U.S. wealth unit)
In the past, independent broker-dealers have struck such mass recruiting deals, during which the new firm has a fixed period of time to recruit as many advisers as possible to the firm. Such a deal is a rarity among the wirehouses, which typically buy a firm outright, said Danny Sarch, an industry recruiter.
“On the employee side, it's unique,” said Mr. Sarch, who added that the Credit Suisse advisers were likely told the details of the recruiting package on Tuesday morning.
Such a conversion of advisers could have a few bumps in the road, he said. “A mass conversion of advisers from one firm to another sounds simple, but in a normal situation you try to minimize the impact on the client. All those little things to take care of clients is difficult to get done quickly and en masse."
The cultures are clearly different, said Mr. Sarch. “Going to a firm with 250 advisers to 15,000 is like changing your daily swim from a few laps in the pool to trying to cross the ocean.”
(More: Raymond James in talks to buy Deutsche Bank's private-client brokerage)
Credit Suisse recently undertook a global strategic review of its businesses, and one conclusion was that it couldn't obtain scale in the United States in private banking without an acquisition, said Nicole Sharp, a company spokewoman. “It's just a scale question,” she said.
Wells Fargo and Credit Suisse said in a statement they also expect to expand their relationship to make additional Credit Suisse investment banking and asset management offerings available to Wells Fargo advisers.
