Commonwealth Highlights Quality Service, Technology at Its ’10 National Confab

(Phoenix) Some 750 financial advisors affiliated with Commonwealth Financial Network, along with 650 other guests and staff members, gathered in Phoenix at the JW Marriott Desert Ridge Resort & Spa in late October for the independent broker-dealer’s national conference. Commonwealth now includes about 1,400 advisors with $59 billion in assets under management.

Commonwealth advisors have $30 million in assets on average and $310,000 in yearly fees and commissions.  “We are continuing to move up to $500,000 [in fees and commissions] per advisor and $1 billion in firm assets,” said CEO Wayne Bloom, during the conference. “This year, we’ve been talking with lots of big offices [about joining us] and are keeping focused on our high-quality service, technology and practice management.”

Net advisor recruiting in 2009 was 140. For 2010, that figure should be down somewhat, as is the case for broker-dealers across the industry, company executives say. In general, Commonwealth aims to grow by about 100 advisors a year. It has four recruiters who are employees and aren’t paid on commission.

“This year, advisors aren’t talking about the sky falling. They’re catching their breath,” said Andrew Daniels, managing principal, field development, for Commonwealth Financial. “They’re looking at their same firms with the same warts and asking, ‘how can I make a change?’ And over the past few months, we’ve had a growing number of contacts and visits.”

“We keep very engaged with about one-third of the advisors that call us. They have to be Commonwealth-quality advisors,” said Bloom, who is based in the broker-dealer’s Waltham, Mass., headquarters. Often, it’s just a question of being patient, he explains.

“Many advisors tell us, ‘I’ve been getting your materials for years and finally decided to call.’ One advisor that recently joined, for instance, went through a five-year recruiting process,” said Bloom.

“And after they join, they say, ‘If I would have known it would be like this, I would have done this earlier!” Daniels said. “This is very reassuring.”

In terms of advisors joining from the wirehouses, this group accounted for about 15 percent of last year’s recruits, says John Rooney, managing principal for Commonwealth in San Diego. This figure could be higher, he adds, but Commonwealth isn’t interested in picking up advisors that are being pushed out because of low production.

Remaining recruits come from national and regional firms. “They are looking for good fee-based platforms, for instance, and have been well trained as wealth managers,” Rooney said. “And many have felt hamstrung by the platforms at their old firms,” added Daniels.

To make its platform as robust as possible, Commonwealth expects to have invested $20 million in IT by the end of 2010, according to Bloom. “Advisors can perform better if you deliver more efficiency to them and help make them more effective,” he said. “And take the annoyance factor out of the system,” shared Rooney.

“Some broker-dealers force the financial advisor to change,” said Daniels. “We ask the financial advisor what change he or she wants to make, and then work for them to make it happen. It’s commonsensical.”

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