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Froude Steps Down as Head of Ameriprise Advisor Group

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Ameriprise Financial (AMP) says Don Froude, head of the Personal Advisors Group, will be leaving this post on March 30. He has been in the role since September 2008 and will work on advisor-focused initiatives going forward.

Separate filings with the Securities and Exchange Commission show that Froude has sold Ameriprise shares for a total of $13.6 million over the past two years. His salary and bonuses in 2013 were $4.5 million, making him the fourth-highest among the firm’s executive leadership.

Bill Williams and Patrick O’Connell – who lead the independent and employee advisor channels, respectively – will lead these channels starting at the end of the month, according to a spokesperson. Both Williams and O’Connell have been with firm for 20 years or more.

“After speaking with company representatives, our initial reaction is that this announcement does not foreshadow negative developments in [advice and wealth management] A&WM but rather has been in the works for the past year,” according to a recent UBS equity report.

Amerprise’s advisor headcount stands at 9,672 as of Dec. 30. That’s down slightly from 9,696 in Q3’14 and 9,716 in Q4’13. Retention in the employee channel — which has 2,096 advisors — was about 91% as of late 2014, while it is 95% in the franchisee channel — which includes 7,576 reps.

Prior to coming to the firm, Froude was head of intermediary distribution for Legg Mason and Columbia Management. He also worked for Alex. Brown and Prudential Bache as a branch manager, after getting into the business in 1980.

“We feel this continuity in terms of management of [advice and wealth management] is important, and to us, also does not suggest any material changes in the segment’s overall prospects on a go-forward basis,” the UBS equity analysts added. “Further, we understand that Mr. Froude will remain with the company beyond March 31, focusing on various field force-related initiatives and other projects.”

In the fourth quarter, Ameriprise had net income of $426 million, or $2.23 per share, topping estimates and beating last year’s net income of $298 million, or $1.47 per share. At the time, Chairman and CEO Jim Cracchiolo said in a statement: “We’re bringing in significant client net inflows, growing our assets under management and increasing advisor productivity.”

Client assets in Advice & Wealth Management grew 9% in Q4’14 to $444 billion. Wrap-account assets increased 14% to $175 billion, with Q4’14 net inflows of $3.1 billion.

Average yearly fees and commissions per rep shot up 13% to $496,000 from $440,000 in 2013, and net-cash sales of financial plans were $70 million in the quarter — an increase from $60 million in the prior period and $66 million last year.

“Experienced advisor recruiting was strong in the quarter, with 73 experienced advisors moving their practices to Ameriprise,” the company said in a Q4’14 statement in late January.

— Check out 12 Best & Worst Broker-Dealers: Q4 Earnings, 2014 on ThinkAdvisor.


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