Recruiting at Raymond James Financial Services and Raymond James & Associates hit near-records in fiscal year 2017.
Scott Curtis, head of Raymond James Financial Services, told ThinkAdvisor that this was the “second best recruiting year we’ve ever had” for the independent channel.
“The prior year was the best, but we exceeded our expectations this past year,” Curtis said.
According to Curtis, interest remains strong.
“We’re going into this fiscal year ’18, which we’re now in, and we’re well ahead of where we were at the same time a year ago,” he said during a press briefing at the Raymond James Women’s Symposium.
Meanwhile, Tash Elwyn, head of Raymond James & Associates, says the employee channel has had a “very, very strong recruiting year.”
“I would describe it as a near-record year, but not quite a record year,” he told ThinkAdvisor. “But, again, a very strong year.”
Elwyn said RJA continues to see “a lot of interest and success” in the West Coast and Northeast in particular.
“While we’re very much bottom-up, opportunistic in trying to identify advisors throughout the country that share our values and we believe are a great cultural fit for [RJA], we do have a top-down strategic focus on the West Coast and the Northeast as historically underpenetrated markets for RJA,” Elwyn explained during the press briefing.
Raymond James measures growth by historical gross revenues rather than numbers of people — although it doesn’t release the gross revenue numbers.
Elwyn and Curtis both discussed some of the recruiting challenges they faced in the past year.
According to Elwyn, “there’s been more noise this year than any other year, at least in my 10-plus years I’ve been in various management capacities.”
Contributing to some of that noise has been the Labor Department’s fiduciary rule and other regulations, Elwyn said.
“I would describe it as a really interesting year, in which both advisors really wanting to ascertain what impact the DOL and other regulations might have on their practice — whether they choose to remain where they are or choose to affiliate with a new firm altogether — was certainly a factor that weighed on potential movement industrywide,” he explained.
In particular, he said the fiduciary rule FAQs that came out in October 2016 “reshaped the landscape” as firms contemplated the appropriateness of continuing to have certain recruiting incentives, like back-end bonuses.
On top of these concerns, Elwyn sees “more flux than there’s ever been in terms of strategy” at many of the firms.
Elwyn said some other firms are asking, “Are we recruiting? Yes or no? Who are we recruiting? Is it purely next gen advisors, is it up-and-comers? Are we still interested in successful veterans?”
According to Curtis, less uncertainty among independent firms likely contributed to why the past year was not the same as the prior year.
“When we look at firms historically that we’ve recruited from, we tend to recruit a much higher percentage of advisors from employee firms — whether its Wells Fargo, Morgan Stanley, Merrill Lynch, Edward Jones, Ameriprise, etc. — than the independent firms,” Curtis told ThinkAdvisor.
That was consistent again in fiscal 2017, he added. While in the prior year, fiscal 2016, there were more advisors from independent firms — as a percent of the total — than is typical.
“I give [CEO] Dan Arnold and his team at LPL credit because I think they’ve done a good job getting out and meeting with advisors that are affiliated with LPL and giving them greater confidence in the organization and the organization’s future,” Curtis said.
Curtis said there was more uncertainty in the prior year at Cetera, as well as LPL.
“In the past year, that uncertainty was not there in the way it was in the prior year,” he added. “So I think that was a contributor to fewer LPL advisors or advisors affiliated with LPL, affiliated with Cetera, considering making a move.”
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