Broker recruiting wars slowed in second quarter

By Joe Rauch

CHARLOTTE, North Carolina (BestGrowthStock) – Wells Fargo & Co’s (WFC.N: ) wealth chief David Carroll said on Wednesday the frenzied pace of broker migration slowed in the second quarter as retention packages offered by rival firms take hold.

“Its nailed people to the floor, so to speak,” said Carroll, Wells Fargo’s senior executive vice president who oversees one of the three largest U.S. wealth units.

The wealth industry has been engaged in a recruiting war for advisers and bankers in the last 18 months in the wake of the financial crisis that dramatically realigned the industry’s largest firms.

Carroll’s comments signal that the battles for brokers may be cooling after many of the largest firms offered lucrative retention packages throughout the past year.

At San Francisco-based Wells Fargo, its adviser ranks slipped 6 percent from a year ago to 15,119, despite the unit reporting $282 million in net income.

The decline in adviser ranks pushed Wells Fargo into third place among the largest U.S. wealth units when ranked by size of the brokerage force, surpassed by Bank of America Merrill Lynch.

Morgan Stanley Smith Barney, the nation’s largest brokerage, also announced a slight decline in its number of advisers.

Wells Fargo’s attrition during the quarter was due primarily to low productivity advisers leaving the company, Carroll said.

The replacements Wells Fargo is hiring, he said, are on average 40 percent more productive.

The company will try to stem the departures and hopes to “dial back the overall attrition a bit,” Carroll said.

He expects Wells Fargo’s total number of advisers to be up by year’s end, compared with 2009.

Stock Market News

(Reporting by Joe Rauch. Editing by Robert MacMillan)

Broker recruiting wars slowed in second quarter