Wells Fargo Soft-Pedals Credit Suisse Hiring: “Not a Game Changer”
The number of financial advisors Wells Fargo Advisors plans to hire from Credit Suisse will not be a huge game-changer, Wells Fargo Corp’s Chief Financial Officer said Friday.
In the big bank’s first public evaluation of the “exclusive recruiting arrangement” with Credit Suisse that it announced in late October, Wells said it will add the equivalent of “three, four or five months of organic” recruitment from CS.
“It’s not a huge game-changer,” Chief Financial Officer Shrewsbury said on a conference call with analysts after Wells reported its fourth-quarter earnings. “I would think of it as a modest acceleration of what would have been organic activity, rather than a game-changing activity.”
read more: Wells Fargo gets ‘physical’ with CS brokers
As previously reported, UBS AG’s U.S. brokerage unit has been aggressively recruiting some of the top brokers at Credit Suisse Private Banking, the U.S brokerage operation that the Swiss bank is shuttering. It is believed to have hired about 75 of the approximately 170 brokers who were working at Credit Suisse, while Morgan Stanley and Merrill Lynch have hired several other teams.
Advisors who opt to go to Wells, the approved recruiter, were told they would find it relatively easy to transfer client accounts and qualify for deferred compensation in bonus and savings plans that Credit Suisse is expected to hold back from brokers who jump to other firms.
Credit Suisse has filed a raiding complaint against UBS with the Financial Industry Regulatory Authority, a sign that it may have been pressured by Wells Fargo for mismanaging the process.
Wells is expected to soon announce it has recruited one senior sales executive and many of the Credit Suisse advisers who work in his regions, where Wells Advisors is not well situated, according to several reliable sources.
A Wells spokeswoman would not comment on success-rate expectations or individual hires. A spokeswomen at Credit Suisse declined to comment. Sources said that may be because the senior manager has not yet signed his contract.
Shrewsbury characterized Wells’s recruiting effort as a “good outcome,” but warned that its brokerage division will not see any benefits until this year’s second half, “even with the maximum number of people originally expected.” He attributed that to the the long time it takes to transfer client assets and accounts.
A veteran Wells advisor who has been involved in recruiting Credit Suisse brokers told us that Wells will have done well even if it lands half of the Credit Suisse advisers it has solicited.