Financial adviser turnover at the four wirehouses — Morgan Stanley Smith Barney LLC,
Bank of America Merrill Lynch,
UBS AG and
Wells Fargo & Co. — dropped to near- historic lows over the past 12 months.
The past year has been “one of the quietest periods I've ever seen in the industry,” said Mark Elzweig, head of an eponymous executive search firm.
There has been little movement on either the hiring or transfer front.
Reports on first-quarter earnings showed that the wirehouses employed 55,204 advisers as of March 31, up 238 from the total a year earlier.
Merrill Lynch hired the most net new advisers over the 12-month period (517) and MSSB shed the most (340).
UBS had 56 fewer advisers, while
Wells Fargo added 117.
These numbers include new advisers hired as well as those recruited from other firms.
According to the
InvestmentNews Advisers on the Move database, 544 advisers changed firms during the 12-month period ended March 31. Those advisers managed $76.8 billion in combined client assets at the time of their departures.
REPRESENTATIVE SAMPLE
The database is representative of a considerable sample of overall recruiting activity in the industry but doesn't include all data on advisers moving among firms. It is based on recruiting moves that were made public or disclosed to
InvestmentNews by industry sources.
During the 12-month period, MSSB saw the departure of 110 advisers managing $14 billion in assets, the data show. Three of the 10 biggest departures as measured by assets under management were from MSSB, including two three-person teams that joined UBS, and Alan Harter, an adviser who came to the firm via the Smith Barney acquisition. He launched Pactolus Private Wealth Management LLC this year.
MSSB also added 53 advisers who managed $9.2 billion at their former firms. With 17,800 advisers, MSSB has the largest brokerage advisory force in the industry.
Emerging firms were involved in moves of some of the largest advisers last year.
CapTrust Financial Advisors, for example, recruited John Pickett and two associates from RBC Wealth Management last June. Mr. Pickett managed $8.5 billion in assets at RBC.
CapTrust also opened a Des Moines, Iowa, office in December after it brought in a four-person advisory team from Holmes Murphy & Associates that manages $1 billion in assets.
The most publicized adviser move of the past year was Michael Brown's departure from U.S. Trust Bank of America Private Wealth Management to Dynasty Financial Partners LLC. He managed nearly $6 billion at the Bank of America Corp. unit.
Not surprisingly, Mr. Brown's departure caused a stir.
Initially, BofA filed suit to stop him from soliciting his clients to join him at his new firm, but later settled the matter.
The defection prompted the parent company to tighten restrictions on advisers thinking of leaving U.S. Trust. The curbs include putting departing advisers on “garden leave” for two months and not allowing them to solicit clients for up to six months.
Barclays Wealth, the wealth management unit of
Barclays PLC, was involved in three of the 10 largest recruiting moves of the past year, according to the database. The firm is aggressively hiring high-end advisers from the wirehouses and private-banking operations as it assembles a business focused on high- and ultrahigh-net-worth investors in the U.S.
It should be noted that the Advisers on the Move database tends to have more information on firms that publicize their new recruits.
UBS, for example, recruited the most new advisers (74) and added the greatest amount of assets ($11.6 billion) among firms in the database, despite persistent rumors that it is looking to sell its U.S. wealth management business. UBS also saw 67 advisers managing $7.6 billion leave the firm, according to the database.
Merrill Lynch, on the other hand, generally doesn't disclose new hires, company spokeswoman Selena Morris said.
Advisers who leave, however, are usually announced by the firms that hire them, meaning that
InvestmentNews has more information on Merrill's departing advisers — 55 over the past 12 months — and less on its incoming ones. The firm has added more advisers than it has lost in each of the past five quarters.
E-mail Andrew Osterland at [email protected].
