Say goodbye to wirehouses.
“This year’s market turmoil is reshaping the retail brokerage industry, with big national companies being replaced by bank-brokerage conglomerates, independent advisors and online discount shops,” writes Annie Gasparro of the Wall Street Journal.
The wirehouse approach allowed companies to take huge risks because they weren’t subject to the same federal regulations as commercial banks. That high risk, Gasparro writes, is what led to their ultimate demise.
“Now that so many stand-alone investment banks have fallen victim to the credit crunch, large consumer banks are taking their place in the brokerage area. Right now, some of the companies that look to be industry leaders include Bank of America Corp., UBS AG and Credit Suisse Group, said industry analysts, brokers and recruiters. Morgan Stanley is also said to be a company to watch.”