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AIG Advisor Group LeadersDiscuss Growth, Robo Option

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Executives with the AIG Advisor Group of independent broker-dealers shared their views on growth and the advisor business during ConnectED 2015, a week-long event in San Antonio that attracted about 2,000 registered reps.

“This is our best recruiting year in seven years,” said Jeff Auld, head of SagePoint Financial, one of the group’s BDs, during a roundtable interview. “We are an island of stability, more than at any other time than I’ve been with the organization.”

While the AIG name became a bit of a liability during the financial crisis, this is no longer the case. Now, some rivals — both big and small — are facing the heat.

“There’s a cloud of uncertainty about where some of our competitors are going and who they are going to be owned by,” Auld explained, without naming any names but alluding to the BDs being hurt by falling stock prices, regulatory woes and the like.

“AIG has been around for 28 years,” Auld added, underlining the confidence management and advisors felt today. “And it really differentiates us from some other firms.”

This has been an important factor in the group’s recruiting momentum, says AIG Advisor Group President & CEO Erica McGinnis. “Our recruiting success really is about our status as, what Jeff called, as an island of stability.”

Providing stability is important, according to Rick Fergesen, head of Woodbury Financial Services. “We take on this role as a broker-dealer for the financial advisor, who has this role for the client. We serve to help with the unpredictability as advisors do things like build financial plans …”

Other IBDs in the AIG Advisor Group are Royal Alliance Associates, led by Dmitry Goldin, and FSC Securities, headed by Jerry Murphy. The organization includes about 6,000 advisors. Before it met in the Alamo City, it tapped Todd Fulks as senior vice president of succession planning and acquisitions; he joined from FP Transitions.

Robo Move?

With the changing financial markets and industry comes change, the BD executives agree, and much of the change involves technology. “At the firm level, we are looking at the robo-advisor option,” McGinnis said.

“This move is not being driven by the financial advisors, some of whom may fear it could replace me,” she explained. “It’s more about seeing what the place is for both the advisor and the robo-advisor. People will always need personal advice.” However, the robo option “could be tremendous for those with simpler financial life and those starting out” via savings, retirement planning, etc., according to the Advisor Group CEO & president.

Some broker-dealer leaders agree. “I see robo-advisors serving clients who don’t ‘seem great’ to advisors, because they haven’t built up a lot of assets yet. But they will [over time] as their lives become more complex with inheritance, etc.,” said Fergesen.

“We want to be positioned to make this [combination] happen,” he explained. “There could be a convergence of the two [programs] … that’s the challenge — to be ready and positioned.”

The group recently rolled out a straight-through processing tool for products such as annuities during ConnectED 2015. “It’s been an incredible year so far,” McGinnis said.