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Associated Securities Expands Its Sales, Geographic Mix

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Associated Securities’ President and CEO John Hurley has been with the Los Angeles-based independent firm for more than a year now. And, Hurley is pleased to report, results at Associated Securities are moving ahead.

A unit of Pacific Life Insurance Company bought the brokerage in 1997. “Pacific was looking for some new directions when they hired me in January 2005,” Hurley says. And he seems to be just what the doctor ordered.

Associated Securities has expanded gross revenue by 20 percent in the first two quarters of this year, Hurley reports. “We had sales of about $67 million last year and are on track for $90 million to $92 million this year. If we keep up this fast pace, we could get to $100 million in yearly revenue.”

The brokerage now has 305 advisors working in about 150 branch locations, mainly in California. The firm has recently scooped up FA practices in Arizona, Ohio and other parts of the Midwest. “We branched out about two years ago,” explains Hurley, who served as president of Tower Square Securities before MetLife acquired the brokerage from Citigroup in 2005.

Associated Securities’ recruiting efforts have been particularly aggressive in the past six months. In June, Hurley visited advisors considering a transition in Texas and Oklahoma. “We want a wider spread” of reps, he says. “And we are concentrating on high-end, fee-based advisors.”

Who’s joined in the past few months? One recent recruit is Tom Ensign, president and CEO of the ProVest Management Group in Columbus, Ohio.

“I wanted a broker-dealer firm to help me and my clients grow,” says Ensign, who’s been in the business 22 years. “Associated Securities has a sophisticated approach to growing a financial-planning practice and how to manage succession.”

ProVest’s clients include athletes and other high-net-worth individuals across the U.S., according to Ensign. To serve these markets better, he would like to expand the practice from three advisors to 12. He’s already in serious talks with three FAs (in Columbus and Scottsdale, Ariz.), and is also speaking with another three about potentially hooking up.

For Ensign, who’d been courted by a publicly traded broker-dealer and went through much due diligence, the move to Associated Securities came after much strategic thinking. “We knew we wanted to align with the best of the best, and we knew that — at the end of the day — you must be aligned correctly.”

Hurley, Ensign reports, is a “stellar” executive who can make such an alignment possible. “He truly understands the day-to-day work of this business,” Ensign explains.

Others, like Joe Callahan of Callahan & Associates in Cincinnati, agree. “He is one of the rare CEOs of any broker-dealer who is literally in the rep’s corner.”

Callahan’s group, which has about $170 million in assets and used to be affiliated with Tower Square, aims to gobble up some CPA firms and grow to $1 billion in AUM over the next several years.

The main driver behind Associated Securities’ recent growth has come from its keen focus, says Hurley. His first move after assuming the helm at the brokerage was to meet with a marketing firm to review the basics: Why do advisors stay with the firm? What’s our niche? How are we positioned vs. rivals? The marketing firm interviewed some 250 of the firm’s brokers, Hurley says.

The main conclusion: Associated Securities has a core of high-end reps with a long-tenure in the industry who appreciate the positive “peer influence” they receive on a day-to-day basis, the executive adds. “They can share similar issues, problem-solve and network, which is key,” he says.

On average, the firm’s advisors have yearly gross dealer concessions of $242,000 a year. The average production of the top 20 percent of representatives is $665,000, and some generate revenues in excess of $2 million yearly. “We want to increase these averages,” Hurley says.

Associated Securities has a staff base of 75 individuals, of which more than 10 work on transitioning brokers.

With consolidation continuing in the brokerage arena, does Hurley have any concerns that Pacific Life could put the firm and the other independent broker-dealers it owns up for sale? “We as a group are very attractive, but I know there’s a strong commitment from Pacific Life to grow the business and our network,” he says.


Who’s joined Associated Securities since April?

AdvisorFormer B-DYearly GDC*Location

Paul RodakLegacy Financial$940,000Willoughby Hills, Ohio

Tom EnsignMulti Financial$1 million-plusWorthington, Ohio

Laurie FacsinaUBS$500,000Cleveland, Ohio

Mike RicinakRoyal Alliance$500,000Walnut Creek, Calif.

Source: Associated Securities *Gross dealer concessions


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