Schwab Hires Ex-TD Ameritrade CEO Tom Bradley on Eve of Merger
Charles Schwab Corp. on Friday said it hired Tom Bradley, the former president of TD Ameritrade, to oversee its custody business servicing independent registered investment advisors with up to $100 million in assets under management.
Schwab’s announcement on November 25 that it will create a discount brokerage and RIA custodial behemoth by buying TD Ameritrade for about $26 billion sent shivers among smaller independent advisors. Several expressed concerns about being severed by Schwab or receiving short shrift in servicing their customer accounts and supporting their business development. Bradley’s appointment is perceived as an attempt to assuage those advisors, some of whom are being pursued by other custodians.
“Hiring Tom Bradley is a very big deal,” Michael Kitces, cofounder of XY Planning Network, wrote in an e-mail. “This should be interpreted as a huge sign of commitment by Schwab that it plans to both expand in the under-$100M RIA segment, and that it won’t abandon small RIAs.”
Kitces said financial planners in the XY network have added more than $3 billion to TD Ameritrade’s platform in the last three years, largely because it waived its requirement for RIAs in the consortium to have at least $10 million of customer assets.
“We’ve known Tom personally for years, and have long admired his successful track record working across the investment services community,” Bernie Clark, head of Schwab’s advisor services division said in a prepared statement. “Tom knows the independent advisor space in great detail, and we’re fortunate to be able to add his depth of experience and breadth of industry relationships to our Advisor Services leadership team.”
Schwab’s announcement asserted that even before the Bradley hire it had been tailoring its services to the under-$100 million AUM market, offering them “virtual business consulting,” live-streaming events, reduced pricing for electronically traded transaction-fee mutual funds and free portfolio management system software. “Within that effort, we are reinforcing our commitment to the core of our advisor client base, and with Tom joining our team, that commitment will only accelerate,” Clark said.
Kitces said that planners will still seek clarity as to how far down the scale Schwab is really willing to go. “Will the $20 million RIA still be welcome at Schwab,” he asked. “That part is still not clear.”
Bradley, who ran TD Ameritrade’s RIA custody business for 12 years—and who began his long stretch at the firm with predecessor discount brokerage Waterhouse Investor Services—was promoted in 2012 to run TD Ameritrade’s retail brokerage business. The shift was widely perceived at the time as grooming him for a role to take the top job at the firm, but those ambitions were thwarted with the Scottrade acquisition.
In his new role, Bradley will move from his metropolitan New York base to the Westlake, Texas, campus that the San Francisco-based Schwab is adopting as its new corporate headquarters.
Bradley will begin his new position as senior vice president on January 13, 2020, Schwab said.
