Morgan Stanley Lands $3.3 Million J.P. Morgan Trio in California
Morgan Stanley Wealth Management prevailed in its latest back-and-forth recruiting competition with J.P. Morgan Chase, hiring three J.P. Morgan Securities brokers in southern California who were generating $3.3 million in annual revenue.
The Johnsons—who collectively have 95 years of financial services experience, said in a statement that they were swayed by Morgan Stanley’s “technology, platforms and banking services.” They did not return a request for additional comment on why they left J.P. Morgan after eight-and-a-half years.
Morgan Stanley in March lured a $9.5-million team of three J.P. Morgan Securities brokers in New York City, two months after losing a New York City team managing $550 million to J.P. Morgan.
A spokeswoman for J.P. Morgan Securities declined to comment.
Morgan Stanley has revived its recruiting appetite after a nearly two-year hiatus following its withdrawal from the Protocol for Broker Recruiting and a prolonged focus on expense management. Its recruiting loan balances as of December 31, 2019 had shrunk 29% from 12 months earlier to below $3 billion.
“Morgan Stanley is back into recruiting big teams,” said Jeff Bischoff, an industry recruiter who has worked for the firm and who said the wirehouse remains “very selective” about whom it will prospect.
Other recruiters, speaking on condition of anonymity, said Morgan Stanley is dangling deals equal to 250% of advisors’ 12-month revenue, including back-end payments for hitting asset-transfer goals. That is competitive with some of the more aggressive hiring firms on the Street, but not at the highest end, they said.
“We’re always in the market for talented people, and frankly, without being arrogant, we’re a place of choice right now on the street for wealth management,” Chief Executive James Gorman said Tuesday at the company’s virtual Financial Services conference.
David Johnson began his 51-year brokerage career at DuPont, Glore Forgan & Co. in 1968, but spent 19 years at E.F. Hutton and Donaldson, Lufkin & Jenrette (where he focused on institutional accounts) before joining Smith Barney in 1994, according to his J.P. Morgan biography and his unmarked BrokerCheck history.
He moved with his sons to Merrill Lynch in April 2007 and to J.P. Morgan in January 2012, according to their BrokerCheck histories. Damon Johnson began his financial services career in September 1997 as a fixed-income trader at McDonald & Company before switching to his father’s retail practice at Smith Barney eight months later. His brother joined the team in 2005 at Smith Barney.
The nucleus of the J.P Morgan Securities traditional brokerage channel was the Bear Stearns retail business the bank purchased during the financial crisis. The unit’s approximately 475 brokers were melded administratively six months ago into a new U.S. Wealth sector that includes JPMorgan Chase’s larger private bank, its bank-branch-based Chase Private Client unit and its You Invest robo unit for mass affluent advisors.
JPMorgan Co-President and Chief Operating Officer Gordon Smith said at the Morgan Stanley financial services conference on Tuesday that the banking giant is interested in growing wealth management through acquisition.