RBC Picks Jefferies’ Armstrong to Replace CEO Taft
Michael Armstrong, who has been running Jefferies’ small wealth management business for the past two years, has been appointed chief executive of Royal Bank of Canada’s much larger U.S. brokerage business.
Armstrong will replace John Taft, who announced at the beginning of the year that he is retiring at the end of May from Minneapolis-based RBC Wealth Management-US.
RBC employs about 1,850 brokers in 41 states, compared with fewer than 50 brokers in nine U.S. and international offices that Jefferies Group and its Leucadia National parent keep as an appendage to its trading, investment banking and money-management businesses.
A spokeswoman for RBC declined to comment. A spokesperson for Jefferies did not return calls for comment about Armstrong’s move, which has not been announced publicly.
The job shift will return Armstrong to a more powerful seat in the wealth management universe, but one in which he will, for a while at least, be second banana. He will report to Los Angeles banker Russell Goldsmith, the chairman and CEO of City National Bank, which was founded by his grandfather. Armstrong begins mid-summer.
Prior to joining Jefferies in May 2014 as its second global wealth management head, Armstrong, 56, ran an executive coaching firm for about a year, according to his LinkedIn profile. He was previously with Morgan Stanley, where he served as head of private wealth management and of the wealth unit’s capital markets businesses during his 11-year career.
“It’s exciting to get the man back,” said Scott Edwards, an adviser in New York who moved to RBC with two colleagues in February, after four years at Jefferies. “It should be a good fit for him.”
RBC is clearly committed to the wealth business, “which is good for clients and careers,” he said, contrasting that with questions about how committed Jefferies is to the business. A person close to Jefferies management said the New York firm offers strong referrals to wealth advisers through its investment bankers but is not known for high recruiting bonuses or high-tier grid payouts.
RBC Wealth-US President Tom Sagissor, who assumed the position earlier this year, will report to Armstrong, while divisional directors Pat Vaughan and Darryl Traweek will continue to report to Sagissor, according to a memo Goldsmith sent to RBC employees Thursday evening.
Goldsmith praised Armstrong as having the background and values to “carry on the company’s fine culture” that was established by Taft, the 61-year-old veteran who has been CEO or RBC Wealth and its predecessor Dain Rauscher since 2005.
Taft, a former chairman, president and CEO of RBC Dain’s Voyageur Asset Management Group, recently told AdvisorHub that he may return to money management with a particular emphasis on products with a socially responsible investing flavor.
Taft, who is the great-grandson of U.S. President William Howard Taft and grandson of Ohio Sen. Robert Taft, who was known as Mr. Republican, denied chatter in the industry that he could run for elective office. But he said the issue of obscenely high executive pay in corporate America and income equality should be a political issue.