J.P. Garofalo, a Los Angeles-based financial advisor whose six-person team joined First Republic Investment Management in early March, has returned to Morgan Stanley in a junior role, Morgan Stanley spokeswoman Susan Siering confirmed. Garofalo's BrokerCheck profile indicates he’s still registered with First Republic, but registered with Morgan Stanley on April 13, 2023.
The team oversaw $1.2 billion in assets, according to published reports, and was led by Alexander Kadish and Nicholas Davey, who have stayed with First Republic. The team provided portfolio management, retirement planning, investment consulting and other wealth management services to individuals, families, nonprofits and private family foundations.
Garofalo did not return requests for comment as of publication.
Garofalo is the latest advisor to depart First Republic in the wake of a crisis spurred by the collapse of Silicon Valley Bank. After SVB’s implosion, First Republic also seems endangered, with customers pulling deposits and investors selling shares, causing the stock to drop nearly 90% in value over the past weeks.
On Monday’s earnings call, First Republic Bank CEO and President Mike Roffler said departing teams accounted for less than 20% of total wealth management assets as of March 31. First Republic says it has retained nearly 90% of its advisors, as of April 21.
The bank’s stock plummeted 49% on Tuesday after reporting an outflow of more than $100 billion in deposits in March. On Wednesday, shares fell another 30%.
Now, the bank is taking steps to strengthen its business, including relying less on big depositors and focusing on loans that can be sold on the secondary market. But those moves add to pressure on the firm’s once-prized wealth management business, Bloomberg reports.
Roffler also said the firm is exploring strategic options. Bloomberg reports the bank is weighing whether to divest $50 billion to $100 billion of assets.
This story has been edited to clarify the role of Garofalo.