We all know the story of David and Goliath, in the world of finance, we’re observing the story play out routinely as boutique firms continue to capture some of the biggest wealth management teams away from the big guys, and at that, primarily from Merrill Lynch. Just this year, First Republic has moved 10 teams averaging between $3M-$15M in team production which is the 4th consecutive year of monster moves.
How are they doing it? The answer is 3-fold. 1) premiere teams at Merrill are unhappy with big bureaucratic firm culture (or lack thereof) asking them to do business in a manner that goes against what made them successful in the first place. Big mistake.
2) FRB has a very competitive, high-touch, platform offering the same and more products and services than ML. 3) For the right fit, FRB lures teams with the highest on-record terms upwards of 400% along with direct referrals to private banking customers. At First Republic as of Sept. 30, 2022, the firm is managing $249.5 billion in assets and growing dramatically.
Two More Top Teams Leave Merrill for First Republic
To put a point on it, two more large teams have just left Merrill for First Republic. NYC based VK Wealth Management, led by Laszlo (Paul) Vasady-Koracs, a 21-year veteran who was just on the Forbes 2022 list of the Best Wealth Management Advisors, has left with his entire team for First Republic. Mr. Vasady-Koracs joined Merrill in 2017 but clearly, the big firm couldn’t compare with what First Republic could offer his team including Jay Goldstein, Christian Martinez, Dana Shaker, and Sean Hanigan. So goodbye to you Merrill from a $7 million dollar team that managed $900 million in assets.
Of course, this team was not alone in the needing to leave sentiment. Just weeks ago First Republic Bank’s landed a huge Merrill team that had been generating over $12 million in revenue in the wealthy suburbs outside NYC.
The group, which had overseen $2 billion in client assets, is led by Harold “Hal” Reinstein and Michael T. Nelson and joined First Republic’s Scarsdale, New York branch from a Merrill office in nearby White Plains, they moved along with three other advisors–Daniel Sirota, Pascale Hainline and Kimberly Ferry–and four support staff. As testimony to the point, Reinstein had been with Merrill for the last 26 years, according to and Nelson was a 23-year Merrill lifer.
The question remains, will Andy Sieg at Merrill decide to alter course, relying solely on a big brand BOA name, or will decisions be made to stop what is not just bleeding, but rather hemorrhaging? Roger Gershman, CEO of The Gershman Group, who is familiar with both teams and has recruited heavily to First Republic stated that, “stupid is as stupid does, you’d think Andy Sieg would be thinking twice about gutting Merrill of its best practices that have made the firm what it is, but this just isn’t so. We’re seeing a lot of curiosity and forecast more and more moves closing out 2022 and into 2023.”
So why doesn’t First Republic buy Merrill in whole? Because they don’t have to and only picking off the cream of the cream advisors.
Curious about all the moves and what might be right for your team? Check out our deal section and let us know if anything looks interesting.
