As Wells Fargo Takes Over, Integration at Wachovia and A.G. Edwards Still Faces Hurdles

As Wells Fargo begins its summer-long re-branding of Wachovia and A.G. Edwards, some financial advisors at what is now the largest retail brokerage firm in the U.S.—16,000 FAs—say the integration of the Wachovia and A.G. Edwards is still incomplete, and leaves much to be desired.

As Wells Fargo begins its summer-long re-branding of Wachovia and A.G. Edwards, some financial advisors at what is now the largest retail brokerage firm in the U.S.—16,000 FAs—say the integration of the Wachovia and A.G. Edwards is still incomplete, and leaves much to be desired.

One top AG Edwards advisor says the back-office is in such disarray that he hasn’t received an accurate paycheck in the past 7 months. He also says a recent routine mutual fund trade request for several hundred thousand dollars was botched and only 90 percent of the shares requested were purchased. He adds that complaints submitted online regarding issues like these have been left unresolved.

A Wachovia spokesman says the firm is working as fast as it can to iron out merger-related issues. “People have been moved around, they’re learning new processes, new jobs,” he says. (Wachovia purchased A.G. Edwards on March 31 2007.) Wachovia Securities president and CEO, Daniel Ludeman, recently apologized to the brokerage force regarding the merger of the two firms and admitted many promises had not been fulfilled.

A couple of months ago, the firm launched a program aimed at fixing integration problems called the Service Quality Roadmap. Jim Donley, the former president of Wachovia Securities private client group, who retired in 2006, and is popular among Wachovia advisors, has offered to help Ron Kessler, Wachovia’s head of operations, carry out the program. The two men are traveling around the country, visiting branches and taking note of brokers’ complaints. They also provide progress reports on the company’s internal website.

Of course, retail brokerage mergers always have their difficulties, and these have been well documented, with Merrill Lynch’s purchase of Advest serving as perhaps the most glaring recent example. When Wachovia announced the purchase of A.G. Edwards on March 31, 2007 analysts were relatively optimistic about the marriage and didn’t forecast FA attrition anywhere near the likes of Advest. The Wachovia spokesperson said he could not comment on the firm’s retention of AGE reps since the merger.

The disgruntled AGE producer says the recent funeral of Ben Edwards III on April 27 served as a reminder for many legacy AGE advisors of the old days at A.G. Edwards, pre-merger. The one-time chairman, CEO and president of the firm was known for his connection to employees, his open door policy and his stated goal of visiting 100 affiliated offices each year. “It was a sad venue, but it turned into a reunion for many of us,” says the AGE advisor of the funeral. He complains that when Wachovia put a moratorium on reward trips for top FAs, a venue at which many advisors share new business ideas, it undercut morale. He says Wells Fargo will have to work hard to convince the rest of his peers to stay with the new firm. “The most common question among attendees was ‘Where are you now?’ That should give you some idea of what people are thinking,” he says.

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