Quotes from Kruszewski

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Jan 16, 2009 10:29 pm

“A.G. Edwards, with almost 6,700 financial advisors, does not have the scale to compete in today’s marketplace,” Kruszewski said in his letter. “I say hogwash.”

  "'If I wanted to be at Wachovia Securities, I would already be there.' Does the above quote apply to you?" Kruszewski wrote in the letter, a copy of which was obtained by the St. Louis Business Journal. "If you want to learn more about Stifel, you need not call the assistant to the district manager to see if the regional manager can set up a meeting with the head of recruiting. Instead, call me."

Yet Kruszewski warned there is a risk to growing too big for its own sake. "It's not a size game."

The letter, and a similar letter sent to Lee, prompted a heated response Aug. 27 by Kruszewski to Robert Bagby, chairman and chief executive of A.G. Edwards.

"Edwards' threatening letters to Mr. Lee and Stifel appear to be tactical maneuvers designed to prevent other Edwards' employees from considering their career options," Kruszewski wrote in a letter. "It is a well publicized fact that you and your senior management team have secured lucrative golden parachutes, including $28 million plus tax reimbursements for yourself. Congratulations.

"It is also highly publicized that thousands of employees will lose their jobs as a result of the merger, with no thought of any duty or loyalty to them," Kruszewski wrote. "You must believe these tactics will discourage those Edwards employees, who do not have golden parachutes, from making career decisions in the best interest of their clients or their families."

You gotta like this guy from Stifel. 

Jan 16, 2009 10:35 pm

Refreshing ain’t it!

One other quote in RR from last Nov…
Ron K. said Merrill Lynch would be bought long before Stifel ever would be…looks like he was right again!

Jan 17, 2009 7:16 am

I would guess the better regionals are overloaded with HOV requests from wirehouses right now. Amazing times! 

Jan 17, 2009 9:31 am

quote from John Lee:

Mr. Lee said Mr. Bagby hired him. “I told him when I resigned that he’s the reason I came, the reason I stayed, and now he’s the reason I’m leaving.”   Does anybody on this forum know how many new offices Stifel has opened with AGE people since the WS merger?
Jan 17, 2009 11:12 am

Here on the West Coast alone - 16 new branches in CA. 2 in AZ, 1 in OR and 1 in WA. with more to follow.

Jan 17, 2009 11:14 am



Stifel Financial, the regional brokerage/middle market investment bank, is thriving in an awful market. Revenues are up, income is up, and the firm has added 21 new offices and 120 advisors so far this year. Responding to rumors that the firm would sell earlier this year, CEO Ron Kruscewski boasted that Merrill would be sold before Stifel would. He wasn’t trying to predict a Merrill sale, quite the contrary. The Street likes what it sees: Stifel stock was snapped up at a September 24 public offering at $45 per share, or two times book value (that day, Goldman Sachs shares were selling for 1.1 times book value). Registered Rep. talked briefly with CEO Ron Kruszewski about the firm’s success and what lies ahead.

Registered Rep.: Stifel Financial has had one heck of year.

Ron Kruszewski: We’re doing pretty well considering the environment. We had record nine-month revenues of $639 million, up 17 percent over last year. Net income is only up 11 percent year-over-year. Profit margins are 13 percent for the nine months, down from 14 a year ago — so that’s not bad, either. [In fact, Stifel stock is up 21 percent year-to-date and has returned a cumulative 783 percent over the last 10 years.]

RR: With the financial services landscape completely changed, how do you like your position in the market?

RK: Let me first say, no one wanted to see the demise of those larger Wall Street firms. But a lot of revenue-producing people have been let go recently and we’re benefiting from that. That many firms shifting to the holding company model without the leverage has also certainly leveled the playing field for firms like ours.

RR: What do you think the appeal of your firm is, and how has that been affected in the last 18 months?

RK: We’ve always believed that our business is a service business — that we provide advice through people and we do not sell our balance sheet, primarily because we weren’t in a position to do so. You could say the appeal of our firm today is that we do business the way it used to be done. As far as advisors, everyone’s saying firms are getting rid of the $300,000 producers, right? We love them. We make money with those guys and we don’t tell them what to do. Every $300,000 producer should call me tomorrow.

RR: One more time: Is Stifel for sale?

RK: Firms similar to ours have sold to be part of the universal bank model. If you look at what price they sold at, and what they’re worth now, I think you’ll find the answer to that question. The real simple answer — as we say in Missouri — is that we’re in tall cotton. We are perfectly positioned to grow shareholder value in this market so why would I sell to someone that I’m gaining market share from? — John Churchill