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.”
Meanwhile, Carson Group fully integrates a decades-old practice in Phoenix, Arizona, and Triad Wealth touts its 5x growth to hit a $2 billion milestone.
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