Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Practice Management > Building Your Business > Recruiting

Raymond James Exec Upbeat on FA Growth, Praises Morgan Keegan

Your article was successfully shared with the contacts you provided.

Raymond James expects its advisor headcount to continue to expand this year, generally through the hiring of individual advisors and teams, according to Dennis Zank, head of the firm’s employee-advisor group, Raymond James & Associates. But the traditionally conservative firm does not appear entirely against a merger or acquisition.

When adennis zanksked by AdvisorOne about rumors that Raymond James is considering the acquisition of Morgan Keegan, Zank (left) said, “Morgan Keegan is a nice firm.”

“You don’t have to be too astute to see the natural candidates,” the executive added. “I can’t comment on any such deal or speculation but have always respected Morgan Keegan and the quality of its advisors.”

Morgan Keegan, which has about 1,200 employee advisors, was put up for sale by its Birmingham, Ala.-based parent company Regions Financial on June 22. The company recently agreed to a $210 million settlement with investors regarding the sale of certain Helios funds. A separate dispute concerning the sale of some $2.2 billion of auction-rate securities was dismissed by a judge in Atlanta, though the SEC has said it is considering an appeal.

As for whether or not Raymond James is open to an M&A deal at this time, “We have grown the private-client group without a litany of acquisitions along way,” Zank said. Its private-client group now has about 5,100 advisors and $278 billion in assets.

Instead, Raymond James has traditionally expanded “the Seiler way,” he explained, referring to the recent hiring of Thomas and Patrick Seiler from Morgan Stanley Smith Barney. (The ex-MSSB high-net-worth team has about $500 million in assets and will be based in Newtown, Pa.)

“We do not have tremendous pressure to continue to grow in ways that force us into acquisitions,” added Zank.

Some experts, though, think Morgan Keegan–which operates with the employee model for its advisors–could be a good fit for Raymond James. “Raymond James is one of the top three suitors for Morgan Keegan,” said Houston-based recruiter Rick Peterson, in an interview.

The other top suitors, he says, are Wells Fargo and Stifel Nicolaus. “It’s clear that Wells Fargo is not against making further acquisitions, and Stifel Nicolaus, though very aggressive at times, has not had a modus operandi of buying other firms, and neither has Raymond James,” the recruiter explained.

For Raymond James, however, “Morgan Keegan fits them and their footprint,” Peterson said. “They need more of a Southeast presence, as they own Florida and Texas but not the area in between the two states as much as they could. Strategically, it makes a lot of sense.”

The St. Petersburg-based company has to assess if the Morgan Keegan advisors would generally stay put once the deal took place, he notes. And Raymond James “has to assess if they want to spend the money and if it is money well spent,” Peterson. “Due diligence is very difficult and is far from a perfect science.”

As for a possible purchase of Securities America, Zank declined to comment.

“Raymond James does not comment on rumor, speculation or any possible acquisitions but welcomes interest from high quality advisors at Securities America who seek an independent, conservatively managed firm, and who would appreciate our comprehensive platform and advisor-centric culture,” said Chet Helck, the company’s COO, in a statement.


Raymond James says that overall recruiting grew steadily from 2005 through 2009. “The unrest in the industry … set the stage for lots of the results that we are enjoying today,” the executive explained.

“For Raymond James & Associates, we are seeing recruiting not quite back at the ‘07-‘08 level but it’s a pretty darn good recruiting year,” Zank said. “We are experiencing better recruiting in 2011 than in 2010 and expect our rep counts to moderately increase as time goes on. That says a lot given the demographics of advisors.”

The recent hiring of the Morgan Stanley team is “a classic example” of Raymond James’ recruiting process, he says. “We have been in contact with the Seilers for about three years. They did tremendous due diligence on us and other firms. They’ve got an impressive practice and were interested in exiting the wirehouse world.”

Other Growth Plans

Zank explained that Greg Williams, tapped earlier this week to be chief administrator of the private-client group, will be looking at “greater degrees of cooperation and coordination” within the firms operations, which include a Canadian broker-dealer, two domestic broker-dealers (that include five operating advisor channels) and one broker-dealer the United Kingdom.

Williams and other executives will also be focusing on further ways to boost retirement-related results, the RJA chief said, through research and product development, for instance. “We want to share more ways for advisor to become even more skilled in this area,” Zank said. “We have the parts in place with Retirement Solutions and expect better packaging of these parts in the future.”


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.