A funny thing happened as the nation recovered from the financial crisis. As the industry’s largest firms flirted with bankruptcy, once-sleepy regional broker-dealers suddenly became attractive to advisors and, thus, asset managers.
These firms grew to a high of 38,249 advisors in 2009. Although the figure slid to 34,359 in 2010, it still represents a three-year compound annual growth rate of 1.3%. And, while this figure seems low, it stands in sharp contrast to an industry that actually shrank over the same timeframe. In all, regional BDs have increased their share of financial advisor assets under management from approximately 13% in 2007 to nearly 15% in 2010.
“Regional BDs are currently well regarded by both their employees and their clients,” Bing Waldert, director of Cerulli Associates, said in a ststement. “Advisors appreciate the importance of wealth management at these firms and Cerulli data reveals that among all distribution channels, investors who name regionals as their primary providers have the highest level of satisfaction.”