Home Office News: Firms Revisit Revenue Sharing, Grow Robos, Boost Retirement

By Julie Daclag July 31, 2020

Below is a look at some changes major distributors have made to their platforms that may have flown under your radar in the past month, collected from Distributor Profiles, a service of sister publications Ignites and FundFire.

Wells Fargo taps nine new fund shops for advisor training

Wells Fargo has a new list of fund families that pay the wirehouse to train and educate its advisors. The recent disclosure shows nine fund families have begun paying the wirehouse training and education compensation since 2019: Alliance Bernstein, Dreyfus/BNY Mellon, Investec, John Hancock, Merian Global Investors (UK), MFS, Morgan Stanley, Neuberger Berman and Thornburg.

Three other fund families dropped out of the program: BlackRock, Columbia Threadneedle and iShares.

Companies on the list agree, in some cases, to “dedicate resources and funding” to provide training at national events hosted by the wirehouse and product training meetings, which “could lead financial advisors to focus on the mutual funds offered from these families,” disclosures state. 

Fund families that renewed their training support at Wells Fargo were: American Funds, Amundi Pioneer, Eaton Vance/Calvert, Federated, Fidelity, First Eagle, First Trust, Franklin Templeton, Goldman Sachs, Hartford Funds, Invesco, Ivy Funds, Janus Henderson, JPMorgan, Legg Mason, Lincoln (Delaware Funds), Lord Abbett, Nuveen, Pimco, PowerShares, PGIM/Prudential, Russell, State Street and Wells Fargo.

UBS hybrid robo hits $1B

UBS Advice Advantage platform, the wirehouse’s digital hybrid advice platform, surpassed $1 billion in advisory assets in July 2020.

The robo, which launched in early 2018, contends with similar products, such as Merrill Edge, to serve affluent clients.

Advice Advantage requires an initial investment of $10,000 and charges an annual advisory fee of 75 basis points. Wealth management technology firm SigFig developed it.

E*Trade acquisition will supercharge ‘Morgan Stanley at Work’

The integration of Solium, the stock plan administrator Morgan Stanley bought in February 2019, with E*Trade will help the wirehouse secure a stronger toehold in the retirement market, executives said in an earnings call earlier this month.

And the effort will only get more powerful after the integration of E*Trade, executives said during the July 2020 second-quarter earnings call.

Morgan Stanley added 180 new corporate clients in June 2020, an increase to 525 since the Solium acquisition. The firm plans to fully convert all its existing corporate clients to Shareworks by the end of 2021.

(iStock Photos)
E*Trade has its own stock plan business and deep experience working with younger clients and those who prefer digital interactions. Combined, Shareworks and E*Trade represent 4.6 million stock plan participants and $580 billion in assets.

During the earnings call, Morgan Stanley chief financial officer Jonathan Pruzan called the Shareworks and Morgan Stanley at Work strategy “important precursors” to the E*Trade deal.

BofA boasts big workplace benefit sales gains

Assets within Bank of America’s retirement and workplace benefit division, Financial Life Benefits, swelled in the first half of 2020. Executives credited the bank’s expanded sales team, which works with Merrill Lynch advisors and banking relationship managers.

BofA had 26 salespeople in early 2020 and could have up to 140 in 2021. In February, head of institutional distribution Steve Ulian said the bank reps would focus on small and mid-size companies, many of which have corporate banking relationships with BoA. 

The bank has 2,200 funded 401(k), Health Savings Accounts, stock plans and plans from small businesses referred through the bank.

RayJay division adding risk analytics platform

Raymond James’ asset management subsidiary, Carillon Tower Advisors, plans to acquire P.R.I.S.M. (Portfolio Risk Insights and Solutions Management), a risk analytics platform, later this year.

Carillon is buying the unit from Blaylock Van, a minority-owned investment banking and financial services company founded in 1993 and based in New York. The terms of the transaction were not disclosed, but the deal is expected to close in the fourth quarter.

“This move underscores our risk-focused culture, enhances the tools available to our investment teams without altering their independently run investment processes, and brings further transparency to clients,” said Cooper Abbott, Carillon’s chairman and president.

Blaylock Van’s director of equities and quantitative research, Steve Singleton, joins Carillon as head of risk. Omur Munoz, Dmitriy Aronov and Yolanda Dolores will also join the multi-asset manager to form a new in-house risk division.

Do you have a news tip you’d like to share with FA-IQ? Email us at editorial@financialadvisoriq.com.