Schwab pledges to play nice with smaller RIAs

Schwab pledges to play nice with smaller RIAs
Ahead of its planned merger with TD, Schwab says it's committed to working with independent advisers
FEB 12, 2020

As Charles Schwab Corp. tries to shed a reputation for focusing more on big guys than the little guy ahead of its $26 billion acquisition of TD Ameritrade Holding Corp., the company has published a five-point pledge to the independent adviser community.

Although bigger is usually seen as better these days, Schwab is boasting that over half the advisory firms it serves have less than $100 million under management.

The company's pledge, which begins by stating that the custodian has no asset minimums, no custody fees and “no intention to raise them,” is likely designed to calm the nerves of registered investment advisers that are being aggressively solicited as Schwab and TD work toward bringing together 12 million client accounts and $1.3 trillion in total assets.

The deal, announced in November and undergoing Department of Justice anti-trust scrutiny, is still at least eight months from becoming official and then a couple of years from full integration.

Ever since the deal was announced, the idea of combining at least 50% of the RIA custody market under one roof has been viewed as a threat to the smaller RIAs known to populate the TD platform, but not always thought to be welcome at Schwab.

In addition to underscoring its commitment to working with smaller RIAs, the Schwab pledge emphasized “best-in-class technology and open architecture,” which also harkens to TD’s reputation for having the better technology of the two giant platforms.

Other components of the pledge designed to help Schwab fend off custodian competitors from poaching RIAs include boasts of its “best and brightest service professionals,” “in-depth practice management consulting,” and a “digital and streamlined” account opening process.

"We built our business on small advisers,” Bernie Clark, the head of Schwab Advisor Services, said in an interview with InvestmentNews earlier this month. “Under $100 million is the fastest growing space.”

Latest News

Financial advisors, what is your volatility game plan for client management?
Financial advisors, what is your volatility game plan for client management?

With targeted "comfort calls" and strategically automated follow-ups, advisors who leverage their CRM systems effectively can show up when clients need them most.

Trump eyes no taxes for Americans making less than $150k, says Lutnick
Trump eyes no taxes for Americans making less than $150k, says Lutnick

The plan could offer $24,000 in relief for some taxpayers, but experts warn of consequences.

No new trial for convicted GPB Capital executives
No new trial for convicted GPB Capital executives

"I've seen lots of denial in this business but this GPB thing take the cake," says one industry executive.

BlackRock-led deal for Panama Ports draws ire from China
BlackRock-led deal for Panama Ports draws ire from China

Commentary from state-owned publication blasts sale to investor consortium as "spineless groveling," denting Hong Kong-based firm's stock.

Gold soars past $3,000 as Trump turbocharges record rally
Gold soars past $3,000 as Trump turbocharges record rally

Higher interest rates and a strong US dollar, which traditionally act as headwinds, haven't deterred market-stung investors from seeking refuge in the yellow metal.

SPONSORED Beyond the all-in-one: Why specialization is key in wealth tech

In an industry of broad solutions, firms like intelliflo prove 'you just need tools that play well together'

SPONSORED Record growth: Interval funds emerge as key players in alternative investments

Blue Vault Alts Summit highlights the role of liquidity-focused funds in reshaping advisor strategies