Virtual recruiting has been either a success or a burden, depending on which broker-dealer firm is giving its earnings presentation for the second quarter — the first full financial results period since the Covid-19 pandemic kept most people at home.
Executives at Stifel Financial and Ameriprise Financial touted during their earnings calls this week how recruiting is getting back on pace, with Stifel even attributing growth in FA production in part to adjustments to recruitment tactics.
Raymond James said its Private Client Group recruited 113 financial advisors in the third quarter, which ended in June, of its current fiscal year. The additions to the FA roster had a combined trailing 12-month production of $71 million, according to the company.
The Private Client Group had a net increase of only seven advisors in the latest quarter, ending June with 8,155 advisors. That was a net increase of 251 advisors year over year, however.
The “net addition of financial advisors was negatively affected by the Covid-19 crisis, which disrupted a lot of [planned] transitions,” Raymond James chairman and CEO Paul Reilly said during the company’s earnings call.
Given the disruption, “a lot” of advisors who had previously committed to join Raymond James in the past few months opted to stay put at their current firms and will re-evaluate the timing for their moves to the firm, Reilly said.
Still, Reilly said, without elaborating: “Our financial advisor recruiting pipeline is strong across all of our affiliation options.”
Raymond James chief financial officer Paul Shoukry also weighed in on advisor recruiting and its impact on revenues.
“Importantly, we plan to continue making growth investments during this period, for example, by recruiting financial advisors and other revenue generating producers,” Shoukry said during the call. “We also continue investing in our support platform, robotic automation and integrated and paperless processes to continue enhancing the advisor client experience.”
Glass half full
For Ameriprise Financial, having 75 new advisors in the second quarter was considered a “very good” result of virtual recruiting and one in which the “momentum continues,” chief financial officer Walter Berman said in the company’s earnings call.
Ameriprise’s earnings presentation referred to its virtual recruiting as “excellent” and said advisor productivity was up by 5% in the second quarter.
However, the net gain for the quarter was 23 advisors — taking the firm's count to 9,894 financial advisors in the second quarter.
Stifel chairman and CEO Ronald Kruszewski likewise boasted that the company’s virtual recruiting has been a success.
Stifel Financial’s wealth management business “had a very strong quarter despite the issues surrounding Covid-19,” largely because of adjustments to recruitment tactics and advisor production, according to Kruszewski, as reported. Stifel added 28 advisors in the second quarter with a combined trailing 12-month production of $23 million, Kruszewski said during the company’s earnings call.
In its second quarter earnings report presentation, Stifel says recruiting drove its T-12 cumulative production up to $161 million in the period April to June, when it had 2,232 advisors, including independent contractors.
That FA production figure is up 17% from $138 million in the first quarter, when the company had 2,224 advisors, and up 140% from $67 million in the second quarter of 2019, when the company had 2,193 advisors. Both totals include independent contractors.
“Overall, I feel very good about our wealth management side,” Kruszewski said, noting the company is “a very attractive destination for high-quality advisors.”
Do you have a news tip you’d like to share with FA-IQ? Email us at firstname.lastname@example.org.