LPL returns to the Osaic well, drawing teams with $4B

The exodus of financial advisors  leaving Osaic for LPL Financial accelerated with two more advisory teams managing billions of dollars making the transition.

LPL, the largest  independent broker-dealer, said Wednesday that it had recruited roughly 30 advisors from Lutherville, Maryland-based Academy Financial and Berwyn, Pennsylvania-based PFG Advisors. Together, the two teams had previously managed roughly $4 billion in client assets at Lincoln Financial, whose wealth management arm was bought by Osaic in May. 

At LPL, the firms will operate under the Academy Financial brand. In a statement on the move, Academy Financial partner Brent Kvech sounded a theme common to advisors recently recruited from Osaic to LPL. He and his colleagues, Kvech said, were seeking "stability."

"LPL is in the business of supporting our business," Kvech said in the statement. "We felt the stability of LPL — a Fortune 400 company with a large infrastructure, economies of scale and robust technology — would enable us to operate independently and focus solely on taking care of our clients."

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Shelter from consolidation

Another large advisory team cited similar reasons in May  when they chose to go to LPL over Osaic. Pilot Financial, a group managing $4.5 billion also once associated with Lincoln Financial, said it was seeking shelter from industry consolidation when it ultimately decided to go with LPL.

"We just didn't want to go through this again," said Greg Smith, a partner in Pilot Financial, at the time of the move to LPL. "And we were a little worried that, at some of the other broker-dealers that we did due diligence with, we would go through a lot of changes down the road as firms consolidate and try to compete with the likes of LPL."

Osaic did not immediately return a request for comment.

LPL is just building on its recent successes recruiting from Osaic, according to Ron Edde, an industry recruiter and the president and the CEO of Millennium Career Advisors. 

"If you're fishing in a pond and you throw to the right bank and catch some fish over there, you're going to keep throwing against the right bank," Edde said.

Edde said he thinks a lot of advisors formerly with Lincoln Financial were happy with that affiliation and the sale to Osaic gave them a reason to start looking elsewhere.

"People are naturally resistant to change," he said.

LPL no stranger to M&A

Of course, teams that are wary of industry consolidation won't necessarily find much in the way of shelter at LPL. The independent broker-dealer has in fact been on somewhat of an M&A tear in recent years.

LPL is now wrapping up an acquisition of Atria Wealth Solutions, a firm with 2,400 advisors and $100 billion in client assets and closed on its purchase of Crown Capital Securities, a firm with 125 advisors and $5 billion under management, in May. In its latest quarterly earnings, LPL reported having more than 23,000 advisor affiliates, a number up 7% year over year, and $1.5 trillion in client assets, up 21% year over year.

LPL's other big teams recently recruited from Osaic include Investment Advisors Financial Group, a 22-person team that had formerly managed $1 billion. Many of the groups moving to LPL also cite the firm's advanced technology, back-office support and independent business model as appealing attributes.

"At LPL, our vision is to be the best wealth management firm to help advisors maximize their success," Scott Posner, LPL executive vice president of business development, said in a statement. "We do that by providing innovative technology, tools, resources and a flexible operating environment that empowers advisors to deliver great advice and run thriving businesses."

Academy Financial was founded in 1992 by Harry Horn, a U.S. Military Academy graduate who continues to serve as a consultant and partner emeritus to the firm. Academy Financial is now run by Kvech, Thomas Joseph Barger, Michael Leonard and Michael McFeeley.

PFG Advisors is led by Tyler McCraw and Steve Morris.