T. Rowe Price Bulks Up Broker-Dealer Sales Force
Baltimore, Maryland-based asset manager T. Rowe Price Group, Inc. is growing its distribution team that sells funds through broker-dealers.
The company commented on the expansion as part of better-than-expected second-quarter earnings results it reported on Wednesday.
Boosted by $2.5 billion of net client inflows, the asset management company said its net revenue climbed 3.7% to $1.4 billion from the year-earlier quarter while net income was up 17.5% to $527.5 million.
“Q2 was particularly strong for our multi- asset franchise and U.S. Intermediaries channel,” T. Rowe Price President and Chief Executive William H. Stromberg said in a prepared statement. “We were pleased that net flows were once again positive in all regions.”
The lion’s share of the asset management company’s revenue, $860.7 million, came from U.S. mutual fund sales, which were up 1.6% from the year-earlier quarter. Revenue from subadvised funds, separate accounts and other products grew 11.4% to $409.5 million.
Fund investors continued to demonstrate a shift to less expensive products and share classes, T. Rowe said. Administration, distribution, and servicing fees fell $5.6 million from a year ago to $125 million, caused primarily by lower 12b-1 revenue the firm earned.
A company spokeswoman declined to provide specifics about the size of its broker-dealer channel “wholesaling” force.
“We’ve been investing in the expansion of our broker-dealer segment over the past three to five years,” she said, sending salespeople to both branches and home offices to “deepen our reach and relationships with financial advisors who focus on wealth management and retirement.”
T. Rowe Price ended June with $1.125 trillion in assets under management, a $43.3 billion increase from the end of this year’s first quarter.
On another front, T. Rowe Price said it is in active discussion with the Securities and Exchange Commission on its application for “semi-transparent,” actively managed ETFs.