A year ago, Morgan Stanley said it was buying Solium Capital Inc.'s stock plan business for $900 million in a bid to add younger clients and tech startups to its stock-plan administration business.
On Thursday morning, the wirehouse firm said it had set a goal to convert one million of those stock-plan investors to wealth-management relationships over the next five to seven years, through a variety of offerings on Morgan Stanley's expanding platform. So far, the firm has moved just 5,000 of the stock-plan clients to wealth management, according to a strategic update presentation the firm released early Thursday as part of its fourth-quarter and full-year 2019 earnings.
The focus on the stock-plan clients comes as the firm drives its advisers to use technology to chase trillions of dollars in customer assets held outside the firm.
Like Merrill Lynch and UBS, Morgan Stanley a few years ago said it was cutting back drastically on recruiting experienced financial advisers, which is costly and labor-intensive, and instead focusing more on growing the annual revenues of its current roster of brokers and advisers through technology and training.
For example, along with last year's acquisition of Solium Capital, Morgan Stanley said in September that it was adding more services for 401(k) participants and other workplace clientele as part of a plan to leverage its workplace access to grow its wealth management business as it seeks to build out more services for participants and become a sort of one-stop shop for their financial lives.
"We think this a very interesting space,” said CEO James Gorman on a conference call with analysts Thursday when asked about the stock-plan business, which is marketed as Shareworks by Morgan Stanley. He said it was part of the firm's move to drive its digital platform and expand its universe of clients.
To that end, Morgan Stanley said that 90% of its financial adviser teams are using digital tools.
Morgan Stanley has been goosing financial advisers to chase assets using new technology. In the middle of 2018, it unveiled a revised pay plan to drive advisers' adaptation of technology.
Meanwhile, Morgan Stanley’s wealth management business reported record net revenues of $17.7 billion for the full year of 2019, a year-over-year increase of 3%, as well as record annual profit before taxes of $4.8 billion, up 7% from 2018. Its adviser head count dipped 1% for the year, ending 2019 at 15,468.
Chicago-based Mesirow Fiduciary Solutions adds flexPATH's plan-level outsourced fiduciary book, boosting its retirement market reach to $164 billion.
Also, Raymond James's employee advisor channel adds breakaways from Wells Fargo and Stifel, while UBS welcomes an ex-Morgan Stanley duo in Indiana.
It promised guaranteed principal and 10% monthly returns. The SEC says it invested nothing.
Ten years after entering the fee-based annuity market, MassMutual Ascend says nearly half its lifetime sales came in the past two years alone – but barriers remain among fee-only advisors.
Amplify, WealthReach, Zeplyn and Zocks have unveiled partnerships aimed at automating portfolio management, content creation, account opening, and client communication.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
