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Bank Broker Seeking Indy/Bank Hybrid Relationship

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Mar 28, 2014 7:58 pm

I am at a financial institution that merely wants me to be available to it's customer base. Both parties are not currently very pleased with the current B/D and the institution does not want a dual employment relationship. I have spoken with LPL multiple times about a "cross-platform" relationship in which I go Indy with an OSJ and retain the relationship with the institution. I am currently an employee of the B/D.

First, has anyone else been through this process, as it is a little unique? Most institutions want more control, not less.

Second, are there any other B/Ds I should be looking at that can facilitate this relationship with me and the institution?

I intend to keep working within the building, which is a bit of a twist to the cross-platform LPL setup. In most cases, the advisor is indy with an outside office. There is no need for me to set up an outside office since I still do 90+% of my business here. The clear advantage is that my payout jumps significantly and I avoid rent and utilities. The institution is happy because they aren't involved and they get at least the same revenue stream, probably more.

Tell me what I'm missing...

Apr 7, 2014 10:14 pm

Your reasoning is sound-as long as your product mix is compatible with the B/D, LPL is a good choice–there are a few others that may allow additional flexibility and lower fees. I come from a banking background and unless things have changed drastically, fee sensitivity was a frequent concern. Most independent B/D’s will be happy to have you housed in the bank as long as the signage is compliant. Happy to talk to you further if you are still gathering information–I understand how important of a decision this is and wish you the best.

Apr 8, 2014 7:17 pm

Thanks. A conversation may be in order here in a few weeks. What other B/Ds would you recommend looking at?

Apr 9, 2014 3:09 pm

I am not being evasive but that is like your clients asking you what investment they should buy. It depends. You mentioned going through an OSJ–do you have a 24? Do you do a fair amount of annuities or insurance? Any fee-based business? Looking for technology upgrades/compatibility? Who are you clearing through now? See what I mean? I really mean it when I tell you there is no agenda other than helping you make the right decision. I have a 10 point analysis I take advisors through. Takes about 15-20 minutes. At the end of it–we will have it narrowed down to 3. Needless to say, no obligation or investment for either of us but some time. In an ideal world, the BD I represent will check all the boxes for you- but I am smart enough to know that will only happen 20% of the time. If we are not a good fit, I will connect you to the right people at the right B/D’s so that you can get the straight answers you need. This is an important decision and you only get one shot at it. BTW–I thought I would get a notification when you responded. Here is my email address if you need to reach me: [email protected]. My name is Marie-Paule Sinyard, by the way. Nice to meet you.

Apr 10, 2014 2:04 am

You are going to need a formal agreement between the bank and the broker/dealer. It can be done as an independent as long as you follow all of the rules and disclosure requirements for transacting business in a bank. I would talk to a few other firms that do this type of arrangement such as Raymond James and Cantella. Good luck.