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Industry Spotlight > Broker Dealers

LPL’s Managerial Ranks Seem Like a ‘Revolving Door,’ Consultant Says

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Monday’s news that longtime LPL Financial executive Bill Morrissey is retiring has prompted several veteran industry watchers to express concern about management stability and other issues at the independent broker-dealers.

“LPL’s managerial ranks seem like they have been a revolving door since CEO Mark Casady left” in early 2017, said Tim Welsh, head of the consulting group Nexus Strategy and a former executive at Charles Schwab, who points out that the firm also has seen several large advisor groups depart recently.

Morrissey had been with the independent broker-dealer since 2004, leading its business-development efforts since 2006. According to the IBD, he is retiring “to spend more time with his young family.”

Other recent exits include Michael Murray, who was LPL’s national sales manager for the West since 2002. He left the firm in May to join Cetera Financial Group as head of its new business development efforts.

HD Vest Financial Services recently nabbed Chau Nguyen Haner, who had been with LPL since 2009 and served as assistant vice president of marketing strategy.

A year ago, Chief Information Officer Victor Fetter left after more than four years in that post. His departure came shortly after that of David Berger, who had been the IBD’s general counsel for roughly four years.

For its part, LPL points out that it has had only one exit from its C-suite in the past 18 months — that of Fetter.

Other Issues

According to recruiter Jon Henschen, Morrissey might have been under pressure from several factors, such as growth goals that possibly were not being met or issues tied to the retention of advisors acquired via the purchase of broker-dealer assets from Jackson National in August 2017.

In addition to the exit of several recruiters, Henschen said there has been industry talk about the firm’s retention bonuses “needing to be increased substantially for a large number of the advisors to [get them to] agree to come over to LPL.”

Plus, the veteran recruiter explained, “The current focus of 50 basis points on assets being offered to entice advisors to join and less focus on recruiter relationship building may also have fallen flat.”

William Blair equity analyst Chris Shutler said in a May report that “the fact that more aggressive offers need to be made highlight the company’s challenges.”

LPL, though, said in a statement that it was “happy with our trajectory and the momentum we have in recruiting this year” and that Morrissey was retiring “to spend more time with his wife and young children.”

The IBD explained that it would add “color and specifics” on some of these issues during its second-quarter earnings call, which is set for July 26.

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