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May 1, 2007 7:56 am

Brokers will begin running for the hills this quarter. What a horrible place to work.

May 1, 2007 7:59 am

What's different about this quarter, Ez?

May 1, 2007 8:33 am

The bank will begin holding back 10% of their payout. In the 3rd quater it will be 25% holdback.

May 1, 2007 8:34 am

"Holdback"?  What on earth are they talking about?  How can an employer 'hold back' wages arbitrarily? 

May 1, 2007 9:33 am
Starka:

"Holdback"?  What on earth are they talking about?  How can an employer 'hold back' wages arbitrarily? 



Probably under some employment agreement that brokers "voluntarily" signed...

May 1, 2007 10:02 am

...but you don't have to prospect.

May 1, 2007 11:03 am

Holdback is only for those that did under 350k last year,starts in 3rd qtr. I wonder what they will do next year?


Also not so bad a place to work if you bust your balls and do over 400k.

May 1, 2007 11:07 am
badmove?:

Holdback is only for those that did under 350k last year,starts in 3rd qtr. I wonder what they will do next year?


Also not so bad a place to work if you bust your balls and do over 400k.



What does it mean to hold back 10%? Can you give us a quick math example of how it will work? If a guy makes $50,000 do they hold back $5,000? If a guy is at a 35% payout, do they drop him to 25%? Thanks.

May 1, 2007 11:31 am

33% payout, you do 30k, pay shopuld be 9900, they hold back 990, pay you 8910, if you hit certain goals you get a percentage of the 990 back at end of quarter.


Hold back goes to 25% in 3rd and 4th qtr. You can not do under 300k here or you are dead.

May 1, 2007 12:03 pm

I can speak for myself only, but I can assure you that I'd be out the door before they finished explaining that to me.  The fact that one is above $400K production would, at least to me, mean nothing more than you're next.

May 1, 2007 12:18 pm

Why not cut their pay? All they do is sit around waiting for some teller to refer Mrs. McGillicuddy to them.

May 1, 2007 12:19 pm

exactly

May 1, 2007 1:22 pm
Bobby Hull:

Why not cut their pay? All they do is sit around waiting for some teller to refer Mrs. McGillicuddy to them.


bobby, you sure have a low opinion of a bank brokers...


i know several bank brokers who all do over $900k, how much biz are you doing?

May 1, 2007 1:27 pm
Vin Diesel:
Bobby Hull:

Why not cut their pay? All they do is sit around waiting for some teller to refer Mrs. McGillicuddy to them.


bobby, you sure have a low opinion of a bank brokers...


i know several bank brokers who all do over $900k, how much biz are you doing?



Does it matter, Vin?  The point being made is that your $900K gross is worthless if the bank comes in this afternoon with the new, improved payout grid giving you 5% net with a 10% 'holdback'.

May 1, 2007 1:29 pm
Vin Diesel:
Bobby Hull:

Why not cut their pay? All they do is sit around waiting for some teller to refer Mrs. McGillicuddy to them.


bobby, you sure have a low opinion of a bank brokers...


i know several bank brokers who all do over $900k, how much biz are you doing?



A better question would be "how much are you keeping?"

May 1, 2007 2:57 pm

the bottom line is the payouts at banks & wirhouses are being cut for low-end producers. anything less than $350k in production isn't profitable enough for firms anymore. so they "encourge" you to do more or get out. that's the harsh reality. thats why you see so many people going indy.

May 1, 2007 3:57 pm

The reason so many go indy is that they are tired of answering to assholes that keep sucking up more and more of their paychecks in return for nothing.  THAT'S the harsh reality.


If LPL can make money taking 10-20% off the top from a 100K producer, you know that banks and wirehouse managements are just plain greedy.

May 1, 2007 4:05 pm
Indyone:

If LPL can make money taking 10-20% off the top from a 100K producer, you know that banks and wirehouse managements are just plain greedy.




Well, they might still be "greedy", but the fact is LPL charges for things banks and wirehouses provide their people, doesn't provide others the rep is expected to carry out of their own pocket AND LPL doesn't (currently, but watch for it to change) carry the same business and regulatory exposure the banks and wirehouses carry for their brokers.


IOW, if LPL had the same expenditures and exposures banks and wirehouses have "10-20% off the top" wouldn't keep them in the black.

May 1, 2007 4:09 pm
Indyone:

The reason so many go indy is that they are tired of answering to assholes that keep sucking up more and more of their paychecks in return for nothing.  THAT'S the harsh reality.


If LPL can make money taking 10-20% off the top from a 100K producer, you know that banks and wirehouse managements are just plain greedy.



Yeah, but the banks DO pay for the business cards.

May 1, 2007 4:30 pm

It seems to me that in the next 5yrs reps doing less than $350k with less than 1/2 book in wrap accounts will be forced out of the business or become part of a team.


Firms can't afford to keep those reps, and going indy is getting more costly due to compliance.