Why RJ's Reilly would love for UBS to sell its wealth management unit

Paul Reilly, CEO of Raymond James Financial Inc., addressed the more than 100 financial advisers gathered in St. Petersburg, Fla., for the firm's annual Women's Symposium this afternoon. He spoke to reporters afterward and spoke about Morgan Keegan & Co. Inc., current events and the state of discourse inside the Beltway. Fresh from a meeting of the Financial Services Roundtable in Washington, Mr. Reilly had harsh criticism for the politicians, whom he blames for creating a crisis of confidence in the markets. “There is no fundamental reason why the market is where it is. It is selling on fear,” said Mr. Reilly, who was appointed to succeed Tom James as CEO in May 2010. “I blame both sides of the aisle for this. The inability of Congress to compromise has created a crisis of confidence. One side says we can't cut entitlements, and we have to. The other side says we can't raise taxes, and we have to. Leadership is about compromise. I fear we have another 14 months of this ahead of us.” While market turmoil has led most of the major Wall Street firms to slash costs and cut jobs, he said Raymond James would benefit on a relative basis. “We perform better in a downturn and we get more people from other firms,” Mr. Reilly said. “I'd rather compete in an up-market but we're recruiting in all our businesses.” On UBS's recent woes:“Anytime a big firm stubs their toe, it's good for us in terms of picking up good people. I'd love for them to sell the [wealth management] business, because if that happens, we'll get advisers.” On his vision for Raymond James' direction: “We're a private client group firm and we'll use the rest of our businesses to better serve our advisers and their clients. We don't push products. Our advisers don't get any extra money for selling Raymond James products. They have to compete on their own merit. I see my job as making tweaks to help the company execute better, but not to change who we are.” On the sale of Morgan Keegan: “I never comment on potential acquisitions.” On the biggest challenges to financial advisers:“How to give clients a return is their biggest challenge. There are fewer and fewer vehicles to earn income for investors. Short-term rates were driven down to help the economy, but at some point we have to let the market take over. The sooner we can return to a free market the better.”