Executives at Raymond James and Morgan Keegan say they expect the majority of Morgan Keegan’s roughly 1,000 employee advisors to stay with the firm after the merger is complete, despite some recruiters’ claims that the transition package being offered FAs isn’t enticing enough.
Tash Elwyn, president of Raymond James & Associates, the company’s employee-advisor channel, said in an interview: “Within 30 days of the timing of the [Jan. 12] announcement of the acquisition, we can say that we will have hosted visits with close to 50% of the Morgan Keegan advisors at our home office in an effort to immediately acquaint them with the fit and match of our two firms.”
The scope of the meetings and the number of executives involved in the discussions is unique, according to Elwyn. “Many firms do a dog-and-pony show in some major cities and share a steak dinner. Our effort is about the compatibility of the combined culture and the story we can share.”
Still, recruiters are not convinced that the retention package being offered will encourage all Morgan Keegan advisors to move over to St. Petersburg, Fla.-based Raymond James and think that some higher producers could depart. Last week, Raymond James said it would give seven-year award offers of 40-70% of production to those reps with $300,000 or more in yearly fees and commissions; the deals begin vesting at the end of year two.
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“Morgan Keegan says that its advisors will stay in their seats, at least temporarily, for a percent of what everyone on the Street is offering,” said recruiter Rick Peterson of Houston. “Raymond James will have to make an extremely compelling case … and the retention deal is not even close to what the full-service competition is offering.”
But Raymond James executives, as well as Morgan Keegan branch managers, say the 40-70% offer is adequate and note that about three-quarters or more of the Morgan Keegan advisors should qualify for it.