George W. Bush and Ben Bernanke headlined the Schwab Advisor Services Impact 2014 conference held in Denver in early November, which was expected to draw some 1,700 independent advisors, 300 exhibitors and 250 employees of the largest RIA custodian.
At the event, Schwab Advisor Services senior managing director Tim Oden shared that the business is making inroads by capturing the assets of wirehouses advisors—at least the most entrepreneurial among them, he says.
The number of recruited teams in the most recent reporting period of 2014 fell 17% from last year, he says, but the level of net new advised assets rose 19%.
This means the “average deal size has gone sky-high,” Oden explains, noting that the average size of advised assets in its recruited teams has increased 31% to a new peak of $144 million. Plus, year to date, the proportion of net new assets coming from wirehouses is more than double the previous year’s pace.
Key strategic investments the firm has made in recent years now give Schwab the ability to attract advisors who six or seven years ago would have taken a pass, given the custodian’s lack of certain “sophisticated solutions” at that time, the executive shared.
For example, the existence of Schwab Bank enables advisors to collateralize portfolios through loan facilities, so wirehouse advisors with clients that have loans or lines of credit can replace them once these client accounts are transferred.
The firm also now has “consultative resources” to help advisors who want to accelerate their business growth or take their service model up a notch, Oden says.