Stifel Hires Wells FiNet Exec to Push into Independent Brokerage
(Updated with comments from Stifel’s Chief Executive.)
Stifel Financial, which has been focused almost exclusively on growing its sales force of roughly 2,200 employee brokers, is turning a fresh eye toward the independent broker-dealer channel.
Stifel is also rebranding the small independent broker-dealer unit, called Century Securities Associates, to Stifel Independent Advisors, according to the announcement.
The move marks a change in direction for Stifel Chief Executive Ron Kruszewski, who has long eschewed the independent broker-dealer model citing narrow profit margins and the potential to compete with its core employee brokerage business.
Kruszewski in an interview acknowledged that the independent channel is “somewhat” less profitable but said that he had been convinced to revisit his position as he saw an increase in large teams industry-wide gravitating toward the channel, heard from a number of prospects asking for the option at Stifel and found a match with David.
“I never really got around to focusing on it until I met Alex,” Kruszewski said. “He is going to take this Corvette that’s been sitting in the garage for 30 years, and we’re going to pull it out and see what we can do. I think he’s a pretty damn good driver, too.”
Stifel passed on a previous chance to grow the independent channel in 2015 when it acquired around 540 independent brokerage reps as part of its purchase of Sterne Agee Financial Services. It sold off the independent contractor business to StoneX Group (formerly INTL FCSTone) a year later.
Kruszewski said David, who started on Tuesday, will work out the details of recruiting offers and how it will promote the channel to prospects.
David had been with Wells for the past 13 years and in his most recent role led a team overseeing recruiting and advisor coaching for independent brokers. From 2008 to 2014, he worked as a managing director at Wells and helped oversee the addition of more than $55 billion in client assets through recruiting and acquisitions, according to Stifel’s release.
Prior to joining Wells, David had been an institutional wholesaler with Lord Abbett, Federated Investors and OppenheimerFunds, according to the release.
A spokeswoman for Wells Fargo Advisors did not return a request for comment. Its FiNet business has around 1,300 independent brokers serving $103 billion in client assets, according to its website.
Stifel’s push comes as a number of brokerage firms, including Wells Fargo, have been expanding affiliation options and blurring the lines between channels in recent years in effort to appeal to a wider audience of prospective recruits and keep assets in-house. In the other direction, LPL Financial, the largest independent broker-dealer by its nearly 17,300 contractors, last year added an employee channel.
Two of Stifel’s largest ‘regional’ competitors, St. Petersburg, Florida-based Raymond James Financial and Minneapolis-based Ameriprise Financial, already serve several thousands of independent brokers in addition to their employee branch networks. Both firms reported declines in employee broker headcount last year while adding independent advisors.
Stifel’s employee force of 2,187 was up 2.8% year-over-year, according to its most recent earnings report.