Stifel Financial is aiming for a bigger slice of the IBD market.
The firm, long known for its employee brokerage and other finance units, is rebranding its independent broker-dealer business and has tapped a former Wells Fargo FiNet executive, Alex David, to lead the effort.
“We already offer the products, services, technology, and support to help independent advisors better serve their clients and grow their careers. Until now, we simply have not emphasized this channel. This is about to change,” Stifel CEO Ron Kruszewski said in a statement.
Recruiters say it’s a smart play for Stifel to make.
“There’s tremendous interest among advisors in the independent channel,” says Mark Elzweig, president of Mark Elzweig Company in New York.
The firm’s IBD, previously known as Century Securities, will now be called Stifel Independent Advisors. The business is not a new one for Stifel — the firm has owned it for three decades — but it is a much smaller piece of the company’s wealth management operations. Ninety-three of Stifel’s 2,280 advisors belonged to the independent unit,
That’s also modest in comparison to IBD giants like LPL Financial and Ameriprise Financial, which field thousands of independent advisors. But Stifel’s focus on the indie business is a sign of how compelling that channel is for wealth managers looking to grow.
For years now, big wirehouse teams have been bolting for the independent channel, either joining IBDs or becoming RIAs. There’s also been increased movement between IBDs, in part because of industry consolidation in the sector.
“The independents, RIAs are a big growing part of the business,” says Michael King, president of recruiting firm Michael King Associates in New York.
Stifel had previously acquired an IBD unit when it picked up Sterne Agee in 2015, but the company sold off that part of the Sterne business to
Stifel’s wealth management division had $357 billion in client assets at the end of 2020, up 8.5%year-over-year.
Firms are on the hunt for new talent, and they are upping their offerings to find and keep it.
With its new hire, Stifel gets an executive with experience in the independent sector. David spent 13 years at Wells Fargo, where he served as head of branch development and marketing for the company’s independent broker-dealer, Wells Fargo Advisors Financial Network. He has past experience at Lord Abbett, Federated Investors, and OppenheimerFunds, according to his new employer.
“I could not be more excited about the opportunity to make Stifel Independent Advisors the premier destination for the industry’s best financial advisors,” David said in a statement. “We believe we will attract and retain advisors that value the breadth and depth of a well-capitalized full-service platform combined with true flexibility of an independent offering.”
How successful Stifel will be in growing this business will depend on not just the kind of support it provides advisors, but also the payouts and transition assistance it offers, according to King. It may have luck in luring over wirehouse advisors who want to retire and sell their practice in the indie channel, King adds.
Stifel has been an aggressive recruiter for its traditional employee channel unit, attracting talent from its larger wirehouse rivals. Giving the independent broker-dealer business more play might boost those efforts, recruiters say.
“It’ll help them with their recruiting in general, including to the employee channel, because when firms can offer advisors options, that makes you a more successful recruiter,” Elzweig says.
