Ameriprise Moves Upmarket, Targets Wires in Latest Hiring Push
Ameriprise Financial is looking to take advantage of a lull in hiring among wirehouse firms to move upmarket and lure in bigger producers and wealthier customers.
The Minneapolis-based firm has recruited almost 200 veteran financial advisors as of September, an 8% increase over the same time period last year, according to Manish Dave, senior vice president of business development and head of experienced advisor recruiting. The new hires, who joined both its employee and independent “franchisee” channels, have come primarily from wirehouse firms, Dave said, and they generated on average one-third more revenue than brokers hired over the same period last year, according to its most recent earnings report.
“When advisors take the time to learn more about our story, we remind them of some of the firms [they knew] when they got started in the business,” Dave said. “We are operating and investing in our business in a nimble fashion that they like.”
Ameriprise reported it had 9,640 brokers at the end of the second quarter, down 1% from 9,750 a year ago. But that sales force has been more productive with $542,000 in annualized commissions in the second quarter, up 7% from $507,000 a year ago, according to its latest earnings report. Just under 2,000 of those were in its employee division and another 7,600 affiliated as independent brokers
The firm, which has its roots as an insurance and annuities firm for mass-affluent clientele, was also serving more clients in the range of $500,000 to $5 million in investable assets and “serving more $1 million-plus clients than ever before,” the company’s chief executive, James Cracchiolo, said on an earnings call in July.
The average producer at Ameriprise is still well below the average of over $1 million in annual production reported at Merrill Lynch, Morgan Stanley and UBS Wealth Management. But in addition to advertising a more congenial and flexible culture similar to older regional firms, Ameriprise has sweetened deals for top-end brokers to compete with the the 250% to 300% once offered by wirehouse firms, recruiters say. That comes as Morgan Stanley, UBS and Merrill have curtailed offers or significantly reduced their targets.
Dave declined to discuss the terms of the deal, but the firm reported that in the second quarter this year that expenses in its wealth unit rose 3% “reflecting higher distribution expenses, including investments in recruiting experienced advisors.”
Some of Ameriprise’s regional competitors have been taking similar steps to turn up the pressure on wirehouses this year.
Ameriprise’s recent hires include at least three teams in August with more than $100 million in client assets. In Boston, Ameriprise picked up 36-year industry veteran William Wiseman and his son, Parker, managed $133 million at a Morgan Stanley.
“After 36 years, I was looking for new energy and opportunities to grow my business and serve more clients,” said William Wiseman, who had also worked for Citigroup, Lehman Brothers, and EF Hutton, in a press release.
Also in August, Ameriprise hired Paul Sheldon, a 42-year veteran who had spent his career at Wells Fargo and predecessor firms. Sheldon, who joined in Westport, Conn., managed $191 million along with his son, Jesse.
Neither the Sheldons nor the Wiremans responded to requests for additional comment.
Alan Blender, who joined from Morgan Stanley in Fort Lauderdale in August, had 33 years of wirehouse experience at UBS and Smith Barney and $198 million in client assets. In an email he said he was attracted to Ameriprise’s focus on financial planning.