Citi & MS combined brokerage?
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There was one that I recall failed about a year ago on the West Coast. Smallish player who got caught up in CMO’s and margin if I recall.
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Brookstreet Securities is what you are referring to. While many b/ds are going to be hurt by the downturn, true independent broker/dealers (not owned by insurance companies) should be able to make up revenue by the addition of the fallen wirehouse and bank advisors. In fact, they will probably be adding staff to support the new business and growth. LPL has trimmed some of it's staff but I think they are using the environment as an excuse so the reps deem it acceptable and a smart business decision. [/quote]There was one that I recall failed about a year ago on the West Coast. Smallish player who got caught up in CMO’s and margin if I recall.
Yes Brookstreet...that was it. If I'm not mistaken, they had a few reps who brought the firm down because they went big on a strategy that involved buying some of the more exotic "non-retail" CMO tranches on margin...and it blew up so bad it took the firm down.
I hope you're right about LPL.
LPL and RJ are basically small wirehouses.
I'm hoping for the weeding out process of financial advisors. There's too many people giving financial advice, just like there was too many realtors and loan officers over the past 10 years. Get rid of the bottom 30% of financial advisors completely, and who cares if veteran advisors get to inherit their books? Rookies and people with less than 5 years experience should be forced into teams so they can be mentored and see if they can make it in the business. Or at the very least make them get a CFP so they can add some value. Unfortunately, my plan won't happen b/c it's too easy to join indy firms like LPL and RJ. For a few thousand bucks you can get a laptop, some software, your E&O, file some paperwork, and then just work from home and call yourself an independent. Maybe you'll get a 90% payout and get some family and friends to be your clients so you can sell them annuities and 'B' shares, then sit around in your underwear all day watching CNBC and call yourself a financial advisor. You can then tell everyone about how bad the wires are, but b/c your independent you have their best interests at heart. It's ridiculous.What's the problem with LOS< 5 years? Would you rather have someone who is LOS 3 at 250K or someone LOS15 with 500K? Who is the bottom 30% in this example?
Answer: whoever joins as a jr. team member instead of looking for an Independent or regional opportunity.Actually, LOS 3 @250k is doing well. On the right track. LOS < 5 and you are still considered an apprentice and they have benchmarks for you to hit. I believe they are going to start nipping off these guys with LOS 6 - 10 doing 100-300k.
so–if the MS-SB deal happens for sure as a JV…is your opinion that if I am a MS rep right now and SB has been recruiting me with a 200% deal…1) are the 2 firms still considered completely separate from a client perspective 2) should I take the deal asap 3) how long do you think the deal will be on the table
The deal is off the table. Do you honestly think if they are in serious talks, that SB is going to approve your deal? Only if the talks break down. If they dont, and the deal is done, then you are standing at the dock, watching the ship leave port without you.
G1, I heard managers at both firms were told to end talks with anyone they’ve been talking to from the other firm. So I would think your deal is off the table.
I also read the new JV would be called Morgan Stanley Smith Barney (how creative). That seems a little wordy to me, but I guess they didn’t want to just do away with one of the names.
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I also read the new JV would be called Morgan Stanley Smith Barney (how creative). That seems a little wordy to me, but I guess they didn’t want to just do away with one of the names. [/quote]
Yes, wordy, sort of like Merrill Lynch Pierce Fenner and Smith. Wasnt there a firm with that name once, back in the day?
How will this affect newhires? I passed my tests and I am just about to head to warren for PS1 with SB. Anyone know the direction how this will affect people like me?
Anyone know how this will effect trainees? I passed my tests and I am heading to NJ for PS1 with Smith Barney soon. How will this affect people like me?
newguy
IF, the merger goes through it will have no affect other than maybe taking a large pool of previously eligible prospects (Morgan clients) off the table. The firms will operate separately for a long time. It took 9 years for Morgan Stanley and Dean Witter to officially merge to one broker dealer! (as registered with SEC)
I would think there would be a moratorium for awhile (assuming a deal is really closed) but if the 2 firms stay separate under a Joint Venture–why would they not continue to recruit, regardless of company-it could take 5,8, 10 years before it comes one final company
I would assume that since you are under a contract and have passed-it won’t affect you at all
Will SB continue recruiting MS FAs? Hahaha, that would be great for the MS guys.
citi also has the bank brokerage that took smith barneys platform last year. what about these guys. i guess since their average production is about $300k morgan will want to leave them in their crappy branches at citi. but wait maybe they will bring them over to start the new morgan stanley bank up…
There are some high producers in the Bank offices. In fact the average production per FA in the Citi/SB bank channel is almost on par with the SB legacy branches. There are only about 700 bank based FA’s. I do not think that the low end producers in the bank channel will last. They are on the same grid, and sub 400K producers with LOS of more than 7 years of service just got a pay cut like in many of the other firms.
I wonder what will happen to good producers in the bank channel.
Deal is done as I’m sure all here have heard. I’m betting an announcement to the field on recruiting each firms brokers is out by Friday this week. Retention is already being talked about as well.