From the November 2011 issue of Research Magazine • Subscribe!

Raymond James Hosts Women’s Conference, Shares Growth Plans

(St. Petersburg, Fla.) Raymond James executives discussed a new training program, series of women’s conferences and other steps to keep the company on a “controlled growth path” during the firm’s annual Women’s Symposium held in St. Petersburg, Fla., in late September.  “Most of our effort is put on increasing productivity with advisors with marketing, technology and other steps to produce greater efficiency and services,” said COO Chet Helck, during in an interview. “Other firms have to cope with advisors leaving and serial acquisitions as a growth strategy, which I would argue has an endgame and is not sustainable.”

“We can grow for rest of our lives at our controlled pace, with no end in sight, if we can deliver a compelling package that people want to be a part of,” Helck explained. One way the firm intends to keep up the “controlled pace,” he says, is by expanding its current training program. “In the past, we have had a formal six-month agenda in new one classroom interspersed with branch activities,” he said. “Now we are introducing a program that lasts for two years and entails specific mentor training.”

These efforts, which are part of the firm’s Advisory Mastery Program, were set to start in October and will be dovetailed with succession strategies focused on female and other advisors, he adds. They will also include preparation work for the CFP exam. “We are still cracking the code on how to demonstrate and prove we are the best firm” for both women and minorities, Helck shared. “We have not accomplished that to the best extent that we want to and will keep trying.”

Over the next year, the Women’s Symposium, which attracts more than 100 of the firm’s female advisors annually, is being taken on the road to help address this issue. Three or four such women’s forums are set to be held in the fiscal year starting October 1, with the first slated for October 27 in Dearborn, Mich.

Raymond James says that about 14.6 percent of its 5,400 financial advisors are women. In the United States, it has about 585 practicing (or producing) female advisors.

Raymond James is also organizing and training some of its top female advisors to serve as speakers at these forums and at other public events. The aim is for the women to serve as financial experts in their communities with greater exposure and boost awareness of the Raymond James brand. The percent of women advisors at the firm who have qualified for its leadership council (based on certain advisor performance targets) rose to 20 percent in 2011 from 13 percent in 2005.

Revenue at Raymond James Financial Services is up an estimated 12 percent year over year, according to Dick Averitt, head of the independent channel, and could be roughly $1.17 billion for the fiscal year. Average yearly production per advisor in this part of the private-client group has risen roughly 15 percent to $360,000, Averitt said.

In the employee channel, assets rose at a compound annual growth rate of about 16 percent in the past 10 years and stand at about $90 billion, according to Dennis Zank, who heads the division. Average fees and commissions per advisor are $538,000 with overall revenue for the year totaling an estimated $715 million.

Women advisors, like Sacha Millstone of Boulder, Colo., say that while they don’t try to precisely keep their practices on track with the firm’s 15 percent corporate growth target, they have their own competitive benchmarks. “I’m very confident in the firm, which has an amazing track record … and keep my own growth targets for revenue, which are very aggressive,” she said in an interview.

“As a company, we have a target of hitting a 15 percent growth target,” said COO Helck speaking at the conference. “One way we do this is by adding productive capacity and another way retention, which is a problem for our industry as you see some firms hemorrhaging people.” An alternative means for growth, he adds, is acquisitions.

Helck noted the firm’s operations overlap with those of Morgan Keegan, in the fixed-income arena. “And we have to account for that,” he said, implying that Raymond James wouldn’t likely move to acquire the broker-dealer, which is now being sold by its parent company Regions Financial.

Attrition rates at some other broker-dealers, Helck says, can be as high as 15 percent to 20 percent. “Replacement is not happening, and they are shrinking.” This should help the firm continue to recruit advisors, he adds.

Overall, the firm’s recruiting momentum is looking good, after a brief slowdown, due to attractive retention bonuses, the Raymond James executives say. At the peak of the crisis, they stress, recruiting was “off the charts.”

The strength of the firm’s recruiting efforts over the past few years, Zank says, is translating into higher production, assets and overall results today. In the coming year, he anticipates recruiting 120 advisors with $60 million in production for the employee channel. During the heyday of the crisis, “We peaked at north of 200,” he explained.

For this fiscal year ending September 30, RJA expects to have attracted advisors with more than $50 million in total yearly fees and commissions and some 110 wirehouse and other reps.

Raymond James said in early October that it hired Cheryl Peschke to be senior vice president of investments in the West Houston office. She joins the firm as part of its employee channel, RJA. “We are thrilled that Cheryl has joined our West Houston office,” said Chuck Zimmerman, the branch manager for RJA, in a press release. “Cheryl exemplifies a deep caring for her clients, which is totally in line with what Raymond James is all about.”

A 21-year industry veteran, Peschke previously managed $92 million in client assets with more than $1 million in production for Morgan Stanley Smith Barney. She began her career as a financial advisor with Shearson Lehman Hutton in New York in 1989 and also spent time with Dean Witter, Paine Webber and UBS.

“I chose to join Raymond James because it is a successful, conservatively managed firm that cares about its clients first and offers its advisors great support,” said Peschke, in a statement. “Plus, I like that a large percentage of the firm’s stock is held by the James family and the firm’s associates, and advisors have direct access to senior leadership. The firm’s values resonated with me.”

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