Anyone who doubted that a big bank could challenge the national wirehouse broker/dealers has to notice that Wachovia’s deal to acquire A. G. Edwards catapults Wachovia’s brokerage subsidiaries into the biggest broker/dealer leagues. The big bank announced May 31 that it will acquire A. G. Edwards and fold it into Wachovia Securities, LLC, creating the “second largest retail brokerage firm in the U.S.,” and run the retail brokerage operation out of St. Louis, according to announcements by both firms. The combination of the two firms will bring Wachovia’s total number of reps up to approximately 15,000.
When the deal closes as expected in the fourth quarter, A. G. Edwards’s current chairman and CEO, Robert Bagby, is slated to become chairman of the united broker/dealer, with Wachovia Securities’ current president and CEO, Daniel Ludeman, to become CEO and president of the new brokerage entity. Under the current structure of Wachovia Corp., the securities subsidiary reports to the president of Wachovia Corp. Capital Management Group, David Carroll, who summed the deal up as: “a rare chance to solidify our leadership in the industry,” in the merger announcement.