UBS Eliminates Practice Management Consulting Unit in U.S.
UBS Wealth Management USA has disbanded its “practice management group” of internal coaches who consulted with brokers on growing assets and gave them tips on teaming and other productivity tools, according to sources familiar with the move.
The layoffs, conveyed to the unit’s approximately eight consultants last week, affects a group led by James Cadet that sources said was popular with brokers and that was mobilized to help some of UBS’s largest U.S. teams bring in new business.
Cadet, a former Texas branch manager who moved to UBS headquarters in New Jersey in October to run the practice management unit, did not return a request for comment sent through LinkedIn. A call to his UBS phone went unanswered.
A UBS spokesman did not immediately respond to a request for comment to confirm the decision and comment on the reasons for closing the unit.
The Swiss banking giant has been on a cost-cutting campaign as part of a three-year plan to boost its profit margin to 25% from 16%, and the repercussions have been felt in its wealth management operations. The bank merged its Americas unit headed by former bank company CFO Tom Naratil with its broader wealth group early last year to achieve efficiencies.
“We intend to deliver an improvement in our Cost Income Ratio by 900 bps [basis points] and a pretax profit growth rate in excess of 20% while continuing to invest in our business,” UBS’ U.S. wealth executives wrote in a “talking points” memo to U.S. “field leaders” last December. “With these ambitious targets, Tom, Brian, Jason and the entire WMUSA management team are focused on creating opportunities for Advisors to grow, ensuring our ambitions are clear and well-understood, and that Advisors feel properly motivated and valued.”
The memo alluded to Brian Hull and Jason Chandler. Chandler replaced Hull as head of the firm’s approximately 6,500 U.S. brokers in January.
UBS AG Chief Executive Sergio Ermotti on Wednesday said that the Swiss banking giant plans to winnow $300 million from its previously announced cost-cutting plan for 2019, citing a challenging first quarter for investment banking and wealth management.
UBS in early 2018 combined its separate divisions for its U.S. and international wealth management businesses in an attempt to reduce costs.
The Practice Management Group had been an appreciated unit for many years at the U.S. wealth unit, surviving through the financial crisis of 2008 and its aftermath, said one branch manager, speaking on condition of anonymity. The unit provided expertise from behavioral coaching to budgeting with goals and metrics, according to a job posting.
“Half of the advisors knew these people,” the source said, noting that the “field” has been getting word of the phase-out as the coaches cancel planned trips to UBS complexes.
The Practice Management group also has been a training ground for branch managers, according to company biographies.