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For this $1B Breakaway, Independence Was Not an Option

The latest advisory team to join national RIA HighTower managed $1 billion at their former firm, Credit Suisse, and considered starting their own independent practice. They decided against running their own business, believing it would take up time needed to tend to the portfolios of their ultra-high-net-worth clients, one of the principals said today.

“It’s imperative that we’re active in the markets on a daily basis,” said Matt Dillig of the Dillig Bowen Group in Chicago. “We have sophisticated clients. Our team has a passion for the capital markets. We invest in all different types of asset classes and we manage money ourselves, in addition to incorporating third-party managers into the portfolios.”

Dillig, 36, and Ted Bowen, 47, joined Credit Suisse in 2008 after leaving Merrill Lynch Private Banking and Investment Group. They’re the eighth team to join HighTower this year.

A spokesman from Credit Suisse couldn’t be reached for comment. The decision to join HighTower was driven by his team’s desire to find a better business model, not by problems with Credit Suisse, Dillig said—the team “looks forward to having a really strong relationship with Credit Suisse going forward. It’s a good firm, and we have a lot of colleagues we’re going to miss.”

They had been thinking about independence for several years.

Part of the reason was client reluctance to keep all their assets with a single custodian, Dillig said. The team, which has 30 families as clients, had been hearing investors tell them, “I’ve got enough money with one custodian. I’d love you to advise me on the next lot of money. But I just don’t want to have any more funds with the same custodian,” he said. The view was prudent, but “we weren’t in a position to offer that.”

Clients also were looking for more “holistic” wealth management, but the team lacked the technology that would allow them to report on assets held away and enable them to provide a broader picture of their clients’ position, Dillig added. HighTower uses Black Diamond Performance Reporting software that would provide such services, he said.

He and Bowen had considered joining regional firms but decided they would have more leverage with a large, growing RIA. “We liked being in partnership with other advisors,” he said.

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