36 recruiting moves, billion-dollar deals and other indie news

August 14, 2020 4:29 PM

Wealth management earnings may be tumbling, but that hasn’t slowed the rising number of recruiting moves and M&A deals.

At least 542 registered representatives managing $34.4 billion in client assets switched their broker-dealers in nearly 150 recruiting grabs announced by independent firms so far this year, according to Financial Planning’s tracking.

The 36 moves, executive appointments, M&A deals, company earnings, tech integrations and other indie news below reflect a sector of wealth management that is adapting to a time of smaller interest revenue on lowered rates and equity impacts from the coronavirus pandemic. It’s a period marked by turmoil and dealmaking.

Take LPL Financial, Raymond James and Ameriprise, for example. After the second quarter, their wealth management units reported net incomes had fallen by around 30% year-over-year due to the effects of the pandemic. The firms’ recruiting figures showed mixed results in the altered conditions.

LPL has added a net 812 advisors in the past 12 months, while the Raymond James Private Client Group has recruited a net 251 over the year-ago period. Both are adding to their record headcounts each quarter. Ameriprise’s Advice & Wealth Management headcount, on the other hand, slipped by 57 advisors even though it recruited 75 in the quarter.

To catch up on the latest recruiting, M&A and other news in the indie space, scroll down our slideshow. To see where things stood last month, click here.

Note: All dates of advisor moves refer to the ones listed on FINRA BrokerCheck rather than the timing of the announcements.

Equitrust Financial Group

Location: Deerfield, Illinois

Financial advisors: Steven Hyman, Charles Noparstak, Felix Aisen, Joshua Noparstak and Gail Crowley

Total client assets: $800 million

Date of move: June 30

New BD: LPL Financial

Prior BD: Securities America (Advisor Group)

Remark: Charles Nopastak and fellow co-founding advisor Steven Hyman launched the practice more than 30 years ago. They affiliated with the No. 1 IBD and its corporate RIA after 28 years with Securities America and 22 with their own hybrid RIA.

Oak Bridge Financial

Location: Houston

Financial advisors: Peter Goudeau Jr., Peter Goudeau III, Larry Boyd and Andrew Brereton

Total client assets: $114 million

Date of move: July 1

New BD: Ameriprise

Prior BD: New York Life Securities

Remark: The father-son team with two other advisors affiliated with the Ameriprise franchise channel after its founder had spent 18 years with New York Life’s BD.

Balasa Dinverno Foltz

Location: Itasca, Illinois

Financial advisors: Co-founder Armond Dinverno, President Chad Carlson and 40 other advisors

Total client assets: $4.5 billion

Date of announcement: Aug. 4

Acquiring firm: CI Financial

Remark: The Canadian RIA acquirer reached an agreement to make its fifth U.S. transaction in the past six months, or eighth when including deals struck by its existing subsidiaries. BDF, a 20-year-old firm, has specific practice groups for clients who are women, widows, business owners, insurance brokers and agency owners, lawyers, financial professionals or divorcing individuals. After the transaction, the acquiring firm’s U.S. business will reach nearly $11 billion in client assets. Raymond James Financial Services Investment Banking advised the sellers in the transaction.

Keith Frasier

Role: Vice president of advisor recruiting

Company: Integrated Partners

Location: Chesapeake, Virginia

Financial advisors: 150

Total client assets: $7 billion

Date of appointment: July 29

Prior firms: Allianz Global Investors, JPMorgan Chase, Morgan Stanley, Merrill Lynch

Remark: The LPL-affiliated office of supervisory jurisdiction tapped the 18-year industry veteran who started as a financial advisor with the wirehouses before tenures in senior management at JPMorgan and Allianz. Frasier will help lead the firm’s East Coast recruiting efforts out of its regional offices in Virginia.

Angie Dietz-Robinson

Location: Cedar Falls, Iowa

Total client assets: $172 million

Date of move: July 21

New BD: Farm Bureau Financial Services

Prior BD: TIAA

Remark: The 20-year industry veteran is the largest addition to Farm Bureau’s wealth management unit since the insurer launched the employee BD in 2018. The company has hired at least 18 advisors in the last nine months.

Hollencrest Capital Management

Location: Newport Beach, California

Financial advisor: CEO Greg Pellizzon and 12 other advisors

Total client assets: $1.7 billion

Date of announcement: Aug. 10

Minority investor: Emigrant Partners

Remark: The New York Private Bank & Trust subsidiary and its affiliate, Fiduciary Network, have invested in 17 firms that collectively manage more than $55 billion in client assets. The latest equity seller works with ultrahigh-net-worth and high-net-worth clients. Emigrant makes non-voting minority investments into wealth, asset and alternative asset management firms.

Frontier Investment Management

Location: Dallas

Financial advisors: Brian Hattendorf, Richard Sowden and Gary Schoen

Total client assets: $3.3 billion in client assets

Date of announcement: July 28

Strategic investor: Hightower

Remark: The RIA consolidator made its third deal of 2020 with an investment of an undisclosed amount in Frontier, which has nine offices and 42 employees. At least 35 of the RIA’s employees serve clients in an advisory capacity. Eight team members are becoming partners of the RIA upon the expected close of the deal in the third quarter.

Deborah Adeyanju

Role: Associate planner

Company: Grid 202 Partners

Location: Washington, D.C.

Date of appointment: Aug. 3

Prior firms: S&P, Deutsche Bank, and JPMorgan Chase

Remark: Adeyanju joined the RIA founded by Keith Beverly, one of fewer than 30 Black advisors in the U.S. who holds both the CFA and CFP designations. As a CFA holder who is also a CFP candidate, Adeyanju will advise clients with a focus on women from Generation X and business founders. She’ll also work on expanding the practice’s research and impact investing services. Previously, she managed institutional loan portfolios and worked in financial and investment writing in-house for Bay Area wealth management firms.

Cashman Consulting

Location: Redmond, Washington

Financial advisors: Judy and Jeff Cashman

Total client assets: $670 million

Date of move: July 20

New BD: LPL Financial

Prior BD: Kestra Financial

Remark: The husband-wife team took their family-run practice to the No. 1 IBD and its corporate RIA after 15 years affiliated with Kestra. In addition, their daughter Megan Baumgartner is the practice’s client relationship manager and their son-in-law Ryan Baumgartner is its chief investment officer. The ensemble practice has six other staff members as well.

Cornerstone Advisors

Location: Bellevue, Washington

Financial advisors: CEO Ken Hart and 34 other investment advisory representatives

Total client assets: $4 billion

Date of acquisition announcement: July 30

Acquiring firm: Pathstone

Remark: Multi-generational family office Pathstone is acquiring high-net-worth and ultrahigh-net-worth RIA Cornerstone in a deal that the firms say will create a practice with nine offices, 200 employees and $20 billion in advisory assets. At least 22 of Cornerstone’s employees will become Pathstone partners as well. Raymond James Asset & Wealth Management Investment Banking advised Pathstone on the transaction.

Private Vista

Location: Chicago and Oak Brook, Illinois

Financial advisors: Managing Partner Jim Weil and 19 other advisors

Total client assets: $1.5 billion

Date of announcement: July 30

Strategic investor: Hightower

Remark: Hightower made an undisclosed strategic investment into the Chicago-based RIA, which is itself the result of a merger of two advisory businesses in 2016. Private Vista promoted seven of its 34 employees to partner as a result of the deal. The sellers considered at least 20 companies before selecting Hightower.

U.S. Financial Services

Location: Fairfield, New Jersey

Financial advisors: Steven Gallo, Altair Gobo, Gerard Papetti, Matthew DeFelice and Joseph Sarnecki

Total client assets: $950 million

Date of acquisition announcement: Aug. 5

Acquiring firm: Bluespring Wealth Partners (Kestra)

Remark: Kestra’s RIA M&A arm purchased a stake of an undisclosed size in the practice, which was already affiliated with the firm’s IBD. DeFelice and Sarnecki will take over the practice from the three other advisors after training with them under Bluespring’s guidance.

Uinta Wealth Management

Location: Salt Lake City

Financial advisors: Chris Williams, Robb Farr, Brad Wittusen, Jeffrey Smith, Roger Thornton and Kelly Holtman

Total client assets: $300 million

Date of move: July 29

New BD: Raymond James Financial Services

Prior BD: Wells Fargo Advisors Financial Network

Remark: Williams and Farr, the co-founders of the practice, each spent nine years affiliated with the Wells Fargo IBD before switching to Raymond James.

Ameriprise Q2 earnings

Location: Minneapolis

Financial advisors: 9,894, with 7,778 franchise reps and 2,116 employee reps

Advice & Wealth Management client assets: $630 billion

Date of earnings report: July 29

Remark: Lower interest rates helped push down pretax operating earnings by 28% year-over-year to $271 million in the second quarter for Ameriprise’s wealth unit. The firm’s advisor headcount was also lower by 57 reps from the year-ago period. Still, the firm added $4.9 billion in net flows into wrap accounts and 75 recruited advisors in the quarter.

Raymond James Q2 earnings

Location: St. Petersburg, Florida

Financial advisors: 8,155, with 4,776 indie reps and 3,379 employee reps

Private Client Group AUA : $833.1 billion

Date of earnings report: July 29

Remark: Pretax income for the firm’s Private Client Group dropped by 35% year-over-year in the second quarter to $91 million on sharply lower interest earnings and economic turmoil from the coronavirus. The firm’s advisor headcount reached a record level, up by a net 251 reps from the year-ago period.

LPL Q2 earnings

Location: San Diego

Financial advisors: 16,973

Brokerage and advisory assets: $762 billion

Date of earnings report: July 30

Remark: LPL’s net income tumbled by 30% year-over-year in the second quarter to $101.7 million amid the lower interest rates and wider economic turmoil of the coronavirus. In the past 12 months, the firm’s advisor headcount has increased by a net 812 advisors. Including recruited client assets of $11.1 billion for the latest quarter, LPL has added $38.8 billion through recruiting in the last four.

Nick Harness

Role: Chief information officer

Company: Kestra Financial

Location: Austin, Texas

Financial advisors: 2,400

Total client assets: $113 billion

Date of appointment: Aug. 4

Prior firms: JPMorgan Chase and Morgan Stanley

Remark: Before moving to Kestra, Harness served as chief technology officer for JPMorgan’s asset management division and as chief information officer of Morgan Stanley’s investment research unit. In the new role, he reports to Kestra CEO James Poer.

Independent Financial Partners recruits

Location: Tampa, Florida

Financial advisors: 240

Total client assets: $6 billion

Date of 1st anniversary: May 23

BD: Independent Financial Partners

Remark: The IBD launched by the former LPL office of supervisory jurisdiction added more than 40 advisors during its first year, according to the firm. “We feel we can be quicker and nimbler than the larger firms of the world, and we intend to use that to our advantage,” CEO Bill Hamm said in a statement. “Most firms out there are stuck in the past, and, while it was painful, we left LPL so we could become the future.”

Fidelity Portfolio Solutions research

Company: Fidelity

Location: Boston

Timing: 1H 2020

Sample size: 3,972 portfolios

Average portfolio: 14 holdings, 7 asset managers, and 61 bps of underlying blended fees

Remark: An average third-party financial advisor’s portfolio had at least 79% of the assets in active management at the end of the second quarter, according to Fidelity’s portfolio construction guidance team. Since 2016, allocations to actively managed fixed income assets jumped by 20 percentage points to 88%, while those of actively managed international funds have surged by 15 percentage points to 63%. On the other hand, Fidelity didn’t see any significant changes to allocations between the first and second quarters despite the economic impact of the coronavirus.

Blucora Q2 earnings

IBD: Avantax Wealth Management

Location: Dallas

Financial advisors: 3,862

Total client assets: $68.5 billion

Date of earnings report: Aug. 5

Remark: Blucora’s wealth management income slipped by 31% year-over-year in the second quarter to $11.7 million due to the impact of the coronavirus, according to the firm. Avantax’s ranks of registered representatives fell by a net 363 advisors from the year-ago period as the firm continues to drop lower producers.

Steve Gross

Location: Briarcliff Manor, New York

Total client assets: $165 million

Date of move: Aug. 7

New BD: Raymond James Financial Services

Prior BD: Ameriprise

Remark: Gross left Ameriprise after 25 years affiliated with the firm. In addition to the Raymond James IBD, the practice aligned at the enterprise level with Boston Harbor Wealth Advisors. As the fifth largest enterprise working with the IBD, Boston Harbor has 13 offices with $2 billion in client assets.

Proquility Private Wealth Partners

Location: Las Vegas

Financial advisors: Andy Ferguson, Patty Yeager

Total client assets: $360 million

Date of move: Aug. 10

Prior BD: Merrill Lynch

Platform provider: Dynasty Financial Partners

Remark: The 37-year wirehouse veteran and his team went independent with Dynasty as their platform provider and Fidelity Clearing & Custody Solutions as their custodian.

Teak Tree Capital Management

Location: Fort Worth, Texas

Financial advisors: Adam Deem and Stephen Kaye

Total client assets: $600 million

Date of announcement: Aug. 11

Strategic investor: Hightower

Remark: The private equity-backed RIA consolidator made its third M&A transaction in two weeks and its fifth this year. In addition to the co-founders Deem and Kaye, the practice includes one more advisor and four other employees.

Scott Belous

Role: Executive vice president of end user experience

Company: LPL Financial

Location: Charlotte, North Carolina

Financial advisors: 16,973

Total client assets: $762 billion

Date of appointment: Aug. 3

Prior firms: TD Ameritrade, Citi and American Express

Remark: In the position overseeing LPL’s product development and operations, Belous reports to CIO Burt White. He had been managing director of digital client experience with TD Ameritrade. Several other executives have left the firm ahead of the close of Charles Schwab’s acquisition of the fellow custodian.

DPL’s RIA retirement planning survey

Company: DPL Financial Partners

Location: Louisville, Kentucky

Timing: Late May to mid-June

Sample size: 201 financial advisors

Remark: More than 55% of advisors said they’re dissatisfied or very dissatisfied with fixed-income returns, according to the RIA turnkey insurance management firm. At least 58% of the group report that the market risk required for the same amount of income has increased in the past decade. In another notable finding, 30% of advisors said they would choose a bond portfolio yielding 2.5% over an annuity paying 7% guaranteed income for life, net of fees. It shows “the strong anti-annuity bias that still permeates some corners of the advice industry,” according to DPL’s executive summary of the findings.

Heritage Harbor Financial Associates

Location: Port Jefferson Station, New York

Financial advisors: Scott Zambelli, Michael Butensky, Fred Azzurro, Amanda Gonzalez, John Thomson, John Dinkelmeyer and Denise Chiarella

Total client assets: $150 million

Date of move: June 26

New BD: Securities America (Advisor Group)

Prior BD: Equitable Advisors (formerly AXA)

Remark: Zambelli and Butensky launched the practice in 2010 as an insurance office, but it has since moved into wealth management. Heritage Harbor has two other offices on Long Island in addition to its headquarters.

Bialke Financial Partners

Location: Virginia, Minnesota

Financial advisors: Christopher Bialke, Dan Rabideaux and Jeremy Bateman

Total client assets: $150 million

Date of move: July 22

New BD: LPL Financial

Prior BD: Lincoln Financial Network

Remark: Bialke left Lincoln after 19 years to affiliate with LPL as its IBD and RIA and Financial Resources Group Investment Services as its OSJ. Within Financial Resources, the practice operates as a wealth management office of the American Bank of the North.

Kestra Private Wealth Services recruiting

Location: Austin, Texas

Financial advisors: Tyler Bolyard, Tyler McKean, Steven Hafner, Walter Valenzuela and Zachary Butler

Total client assets: $845 million

Date of moves: May 1-July 1

New BD: Kestra Financial

Prior BDs: Wells Fargo Advisors, UBS, Hilltop Securities and Merrill Lynch

Remark: Kestra’s hybrid RIA for breakaway advisors from wirehouses and other employee-channel firms says the second quarter was its most successful for recruiting in its nearly 10-year history. McKean and Hafner made the largest transition of the quarter, leaving UBS to join existing Kestra PWS practice True Alpha Wealth Management in Sandusky, Ohio. At the wirehouse, they had managed about $270 million in client assets.

Stirling Financial Group

Location: San Diego

Financial advisors: Scott Dudley and David McQuade

Total client assets: $200 million

Date of move: July 23

New BD: LPL Financial

Prior BD: Northwestern Mutual

Remark: Dudley and McQuade launched a new practice with three support staff members after spending about 25 years affiliated with Northwestern. They aligned with the LPL corporate RIA and chose Financial Advocates as their OSJ enterprise.

Waddell & Reed Q2 earnings

Location: Overland Park, Kansas

Financial advisors: 1,317 advisors and registered reps

Total wealth management client assets: $59 billion

Date of earnings report: July 28

BD: Waddell & Reed Financial Advisors

Remark: Wealth management underwriting and distribution fees dropped 6% year-over-year and the Waddell & Reed IBD’s advisor headcount shed 30 advisors in the past 12 months. The smaller brokerage force boosted their average 12-month revenue per advisor by 14% to $464,000. In addition, at least 21 incoming recruits with a combined $1.4 billion in client assets at their previous BDs have affiliated with Waddell & Reed in 2020.

Summit Wealth Advisors

Location: Frisco, Colorado

Financial advisors: Robert Fred Lau and Emily Ann Messegee

Total client assets: $130 million

Date of announcement: Aug. 5

Acquiring firm: Mercer Global Advisors

Remark: Represented by FP Transitions, the sellers opted to fold into the Denver-based consolidator with more than $20 billion in client assets across 40 practices nationwide. Lau founded the firm in 1993, and he and Messegee dropped their FINRA licenses to go full RIA in 2017.

WisdomTree model portfolio integrations

Location: New York

AUM across WisdomTree Investments: $60.6 billion

New model integrations: Carson Group, Riskalyze, Kwanti, ETFLogic, Orion Communities

Date of integration announcements: July 27

Remark: The asset manager agreed with four fintechs and Ron Carson’s wealth management firm to enable access for advisors using their platforms to WisdomTree’s Modern Alpha and ETF Model Portfolios.

Fidelity’s Bond Beacon

Firm: Fidelity Institutional

Location: Boston

Financial advisor clients: More than 60,000

Total AUA: $765 billion

Date of platform launch: This month

Remark: Hundreds of BDs and thousands of RIAs using Fidelity as their clearinghouse and custodian are receiving new bond software via the firm’s Wealthscape desktop for advisors. Fidelity plans to roll it out this month following a pilot program. The software enables access to “institutional-grade” liquidity and portfolio construction, along with risk analytics and account-level integration, according to the firm.

Keith Boyd

Location: Flemington, New Jersey

Total client assets: $180 million

Date of move: July 24

New BD: LPL Financial

Prior BD: Wells Fargo Advisors

Remark: After 20 years affiliated with the wirehouse, Boyd went independent with LPL and Gladstone Wealth Partners as the practice’s office of supervisory jurisdiction and hybrid RIA.

California Wealth Transitions

Location: San Diego and Brea, California

Financial advisors: Keith and Nicki Brandt, Janet Pearce, Bradley Saunders, Krista Murray, Blake Murphy and David Brandt

Total client assets: $500 million

Date of merger: July 1

BD: Kestra Financial

Remark: Two former LPL and wirehouse practices that affiliated with Kestra Private Wealth Services in 2014 have merged their businesses. San Diego-based California Wealth gained a foothold under its brand that is closer to its Orange County and Los Angeles-area clients.

Andy Kalbaugh

Role: Divisional president of national sales and consulting

Company: LPL Financial

Location: Charlotte, North Carolina

Financial advisors: 16,973

Total client assets: $762 billion

Date of retirement announcement: Aug. 14, effective March 2021

Tenure: 13 years with LPL, 31 in the financial services

Remark: The No. 1 IBD’s head executive in charge of advisor growth and retention is stepping down to retire next year after 10 years as a managing director. He had joined LPL in 2007 after its acquisition of the Mutual Service Corporation.