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Author: rafferty

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Private equity likely buyer in Cetera sale

16:15 27 February in In the News by rafferty

February 26, 2018 By Tobias Salinger, Financial Planning Cetera Financial Group’s more than 7,700 advisors across six independent broker-dealers may soon face yet another big change: new ownership. The IBD network is exploring a sale and the price tag could amount to $1.5 billion, or $350 million more than RCS Capital paid in 2014 to acquire the El Segundo, California-based firm, people familiar with the matter told Bloomberg. Creditors assumed control of Cetera after RCS went bankrupt in 2016. Executives with Cetera and its current parent, Aretec, retained Goldman Sachs to help with what they called “a capital structure review process,” the firm announced this week. Representatives for the firm said it would be premature to speculate on the outcome of the review. Private equity firms and other investors see opportunities in wealth management, Cetera...

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How to Conquer Your Top Fear When Changing Broker Dealers: Client Retention

19:27 21 February in Articles Written by Jon Henschen by rafferty

February 21, 2018 Jon Henschen as published on ThinkAdvisor You may have heard this before, “If you change your broker dealer, you’re going to lose 30% of your book.” It’s fairly common for advisors to make blanket statements such as this about client retention. And while it is possible to lose clients, the devil is in the details: where are you leaving from, where are you going to, and why. If you’re going from a bank to an independent broker dealer, a 30% or higher loss of your client base is quite common. This often is due to non-compete clauses and bank legal maneuvers to prevent your clients from moving with you. However, if you are moving from an independent broker dealer to another independent broker dealer, retention numbers are much higher, with losses of...

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If Finra eases firm oversight of outside business activities, broker-dealers could lose revenue

21:23 16 February in In the News by rafferty

February 15, 2018  By Mark Schoeff Jr. Investment News A pending Finra proposal to ease the requirement that brokerages supervise their representatives' work with unaffiliated registered investment advisers sounds like regulatory relief. But some brokerages are worried about the price for losing oversight of outside business activities. Monitoring an unrelated third-party adviser can be a hassle, but it also means broker-dealers can take a cut of their affiliates' RIA revenue, usually about 5%. The Financial Industry Regulatory Authority Inc. board advanced the proposal at its December meeting, but the agency has not yet released a rule proposal. Depending how it's written, obviating the need to supervise RIA work also eliminates the need to charge for that service. As more hybrid advisers shift from commission-based revenue to fee-based revenue, IBDs are eager to capture some of...