WANTED! Two Firms Ramp Up Their Interest In Landing Goldman Sachs Advisors (**and open up their checkbooks to prove it)

Traditional wealth management firms have historically found it difficult to accurately price Goldman Sachs advisors and teams. Most notably, there’s been a ‘play it safe’ strategy that focuses on annual W-2 comp versus gross client revenues generated by the advisor.

One firm has figured out that Goldman advisors have an excellent history transferring assets, as they have remarkable client relationships. So putting together a deal based on just W-2 comp doesn’t make sense. Annualized revenue (or how they would value a Merrill team) is the right way to do it.

UBS has been quite effective at grabbing the attention of Goldman teams across the country as of late, and it looks like they’ve taken a key step in making an even bigger splash: deferred compensation.

As we hear it, Goldman plays games with advisors deferred compensation when they leave. UBS has decided to make that a non-issue and is including deferred comp balances for Goldman advisors in every deal they do. Done and done. No more golden handcuffs.

**This is on top of the 200-250% recruiting deal and the 260% retirement deal UBS offers. So if you’re a Goldman team reading this, you read it right – that’s better than 5x on your current annualized gross revenue.**

Oh, and about the second firm we mentioned? They aren’t totally ready to announce their full intentions with Goldman teams, but when they do, we expect them to make waves across the country. (Name rhymes with Rockefeller).

Rockefeller Deal Ticks Higher, Culture Still Resonates With Biggest Teams From Merrill and Morgan Stanley

Rockefeller has had unquestioned success recruiting big teams. That’s not debatable. Every month multiple announcements find their way into the press proving that fact.

Large teams from Morgan Stanley, Merrill Lynch, and UBS continue to find the story remarkable and easy to sell to clients. Assets transfer quickly and the ‘bespoke’ feel of the firm isn’t just a narrative, but rather reality.

In a conversation with a couple of sources close to Rockefeller, it looks like their recruiting success may tick higher in the second half of 2021. Rockefeller remains highly capitalized and focused on hitting home runs on the recruiting trail.

Leaving direct quotes out of it, Rockefeller has done deals with some of the biggest upfront payments in the industry. That’s part of the reason why they remain selective with who they recruit. The teams recruit and cut big checks to transfer their assets. So there is a clear roadmap.

The above paragraph is a nice way of saying if you’re a big team you’re going to get paid at Rockefeller. Big time paid. They like to win, and based on the current recruiting scoreboard, they keep winning.

So back to the headline, yes, Rockefeller’s deal has ticked a smidge higher, as has their flexibility in constructing deals. As an example, they do a great job handling teams with retiring advisors. That flexibility has made them very successful with Merrill teams.

That success will continue. Also, keep your eyes on Chicago and Denver. Rockefeller has some big things cooking in both locations.

Slow Leak Out Of Bernstein Picks Up Speed; Larger Advisors Migrate To Greener Pastures (mostly to UBS)

There’s been a lot said about the massive shift in private banking and ‘non-traditional’ recruiting over the past several months. Much has been written about both J. P. Morgan and Goldman Sachs teams moving UBS and to a lesser extent, Morgan Stanley.

Add Bernstein advisors to that narrative. In the past 12 months these are the names and numbers associated with transitions away from Bernstein:

Dallas $13M John Baumgarten, Cory Dowell and Chad M. Jones
– San Francisco $7.6M Robert Stoker
– New York $10M Alex Hewit/Mike Tucker
– San Deigo $7M Chis Pitzak
– Nashville Jay Degeare $12M
– Julian McGraph $4.5M

Each of those moves is of note based on the well-known reputations that each advisor had within the Bernstein ecosystem. These aren’t lower-level ‘analysts’ or VP’s. These are Managing Directors of the firm.

A note before we close out this article – UBS is in an absolute tear and is showing ZERO signs of slowing down. Zero. They’ve very effectively taken dozens of J. P. Morgan private bankers, several Goldman Sachs teams, and Bernstein teams. As we hear it, the pressure and focus on Bernstein and Goldman are about to ramp up in the second half of 2021. A pivot, or shift if you will.

It wouldn’t surprise us at all if the same amount of advisors/teams noted above came out of Bernstein in the next six months, increasing the velocity of movement out of the firm. Just expect more headlines.

The narrative and reality with regards to the Bernstein to UBS pipeline are real and worth understanding. The proof, as they say, is in the proverbial pudding.

DOMINATION! UBS Is Hammering The Recruiting Competition This Year, And It Isn’t Even Close

UBS hasn’t found the secret sauce, they’ve perfected the use of Thor’s magical hammer and are pounding away at rivals who’ve yet to figure out a way to match their efforts.

J. P. Morgan in particular is being completely bludgeoned with zero signs of the mass exodus of top talent slowing down. While a few private bankers from JPM have matriculated to Morgan Stanley, more than 90% have taken their talents directly to UBS.

Add those to the Merrill, Wells, and Morgan Stanley wins and UBS is so far out in front of its competition the race seems rigged. But it isn’t… rather it’s a well-executed recruiting strategy that may have seemed risky a year ago but has turned into absolute gold.

A two-fold ‘macro’ decision was made and has resonated in a way that has UBS up by 5X their closest competitor (Rockefeller) instated client asset transfer. As it stands today, UBS is a few bucks away from the first half of 2021 total of $60B in client assets recruited. Amazing.

Can they keep it up through the second half of the year? Not likely. But even if the pace slows, UBS could still end up with a $100B year. Unprecedented.

If you want to define recruiting domination – this is exactly what it looks like.

A Dynamic Recruiting Conversation: “Should we even consider Wells Fargo?”

In a lengthy discussion with a team that seems determined to leave JP Morgan Securities, multiple points of the recruiting and due diligence process were uncovered. Given the depth of the conversation, the highlights seemed to be noteworthy and of value to the wealth management discussion.

With assets under management and revenues at all-time highs across the industry, recruiting is white-hot. Deal percentages are at the highs, while hurdles inside deals are near all-time lows. It is a seller’s market in every way.


You happen to be tethered to a Wells Fargo logo. The conversation is much different given the missteps that have come from that firm in the past 24 months. Whether it be fraudulent account openings or a newly minted CEO making racially insensitive remarks, Wells Fargo has stumbled its way to where it currently resides – a recruiting afterthought.

Here is how that conversation went last week:

“Should we even look at Wells Fargo? I’ve heard their deal is big, but will the fog ever lift from that place? Leaving JPM and the brand itself is really our only challenge with client transition – I can’t imagine the extra weight explaining a move to Wells Fargo would entail.”

“Are serious teams really going there or is it just straight-up money grab? It feels like anyone that goes there is striking a massive almost off-book deal. That’s just our perception. Merrill Lynch is probably a more interesting name than Wells at this point.”

Oof. Merrill (a division of Bank of America) is more interesting right now. If there was ever more painful wealth management recruiting take we’ve yet to hear it.

But that is where Wells Fargo finds itself. The biggest deal on the street, paying recruiters up to 10% deal fees, and adjusting deals for teams in any way possible to lure them into the fold.

As the saying goes, “desperate times call for desperate measures.”

Betting On Zero: The Friction Associated With Recruiting Due Diligence Has Dwindled To Almost Nothing

Trends and changes often sneak upon us. We usually don’t see them (or act on them) until it is nearly too late. This is an article to make sure you see a current trans very clearly and don’t let it pass you by.

For the entirety of your career, the idea of engaging in the process of discussing a move to a new firm and walking the pathway of due diligence was a ‘cloak and dagger affair. Taking phone calls off-site, in your car, lunches across town, using clandestine email accounts, etc etc. The stress associated with the process of getting a meaningful offer kept most advisors from pursuing the process.

**CLEARS THROAT** All of that is gone. Gone. Gone. Gone. Due to changes brought on by the Covid pandemic the ease of engaging with firms interested in your services has never been easier. If you want to take a phone call from a rival manager, no problem; take it from your home office and your cell phone. We doubt your significant other is going to report you. Need to take a meeting with department heads important to your book? Again, no problem; jump on a Zoom call from your deck.

The point here is this: the friction associated with the recruiting process has never, ever been lower. In fact, it is approaching frictionless. If there’s anything positive that’s come from Covid associated charges to the industry, this is one of them.

If you are betting on zero and looking to find the best value for your book (with markets and client balances at all-time highs) the ‘climate’ has never been better.

Keep An Eye On The Uptick In Morgan Stanley Recruiting; Dallas Merrill Team Another ‘Competitive’ Win

Morgan Stanley isn’t grabbing all of the recruiting headlines in wealth management these days, but their trajectory is worth noting. Their latest win in Dallas is notable given the competitive nature of the bidding versus rivals old and new.

The terms of the deal haven’t been disclosed but landing a Merrill team doing $5.5M in annual production these days is no small feat. Merrill may be the most heavily recruited ‘away’ firm on the street right now, so every ML situation is competitive.

The group that migrated to Morgan Stanley in Dallas is captained by 39-year vet John Calandro along with his brother and son, Kevin Calandro, and Rob Calandro. They manage more than $720 million in client assets and brought with them admin staff Shea Self and Jonathan Hicks as well as Redding May.

Now here is the competitive bidding part of it – this was a three-horse race. UBS and Rockefeller were both heavy contenders for this team’s services and pushed their deals higher.

A source close to the negotiations had this to say, “each firm had pushed their deals and deal structures to the limit and well past 300%, ML teams are commanding premiums right now.”

And there is the money line: Merrill teams are commanding premiums right now. Including deferred comp balances, the Morgan Stanley deal breached the 350% number. Cha-Ching!!

Morgan Stanley will continue to be aggressive and maybe the ‘belle of the ball’ for the second half of 2021. Get your popcorn ready.

Wells Fargo Rebirth? Even Offering The Largest Recruiting Deal On The Street Isn’t Working

Its well understood that wealth management recruiting is white-hot. White. Hot. It’s a seller’s market as even middling advisors and teams are in a position of strength, commanding premiums on stated deals in the wirehouse space.

So what to make of Wells Fargo’s position? It’s simple really, no matter what they’ve tried (apologies, congressional appearances, new CEO, and executive leadership) the narrative is largely negative. Advisors have nearly zero interest in Wells Fargo as a destination. That’s not an exaggeration, it’s an ‘on the ground’ fact.

Advisors’ current view of the firm is a fallback at best, and a ‘no chance I’d consider them’ at worst.

A year ago it looked like Wells Fargo may have been turning the corner, and then… the newly minted CEO made a boneheaded comment about diversity on a conference call. In today’s corporate environment, that was an epic mistake. Any momentum that may have been building died right there.

Wells has been attempting to employ the ‘money talks and bullshit walks’ approach to recruiting, effectively offering the largest deal on the street. It hasn’t mattered.

Will Wells Fargo eventually make it back to being a meaningful player in the wealth management recruiting landscape? Maybe, but it’s far from certain.

Morgan Stanley Is Missing The Private Banking Opportunity; Head of Recruiting Ben Firestein Says “Not Interested”

Several firms have decided to absolutely feast on private banking recruiting so far this year. The ranks of J.P. Morgan, Goldman Sachs, Bernstein, and Citi have been migrating to rivals UBS with a smattering finding their way to Merrill and a few others.

In fact, over the past 120 days. UBS alone has announced nearly $10B in private banking assets from J.P.Morgan and Wells have migrated to the firm. Another $5B, in that same period, has moved to First Republic and Merrill.

So where is Morgan Stanley?

In a conversation passed to us from a recruiter who asked to remain anonymous, Morgan Stanley has eschewed private banking recruitment unless the bankers have an interest in taking a greatly reduced ‘W-2 based’ deal structure. The quote we were passed from Ben Firestein, National Director of Recruiting for Morgan Stanley:

“We’re not interested in competing for private bankers at those valuations. We can’t get anywhere near those numbers.”

That begs the question, what are ‘those numbers’ that Mr. Firestein is staying away from? UBS specifically is doing deals that focus on private bankers score cards rather than their W-2 numbers. That makes the deals remarkably more lucrative than anything it’s competitors are offering. When we say more lucrative we mean 4-6 times more lucrative. A 20 year vet from a private bank would be offered a $2.5M deal from Morgan Stanley, whereas UBS is offering a $10M deal.

That’s not in the same universe, and it gives context to the language used by Mr. Firestein when he said “…not interested in competing”.

It’s an interesting calculation made by Morgan Stanley versus its rivals. Some might say that in the wealth management space Morgan Stanley may not see a meaningful rival at the moment. Wells Fargo is limping along, Merrill/BofA is a shell of its former self, and UBS is a boutique compared to the scale of MS.

Still, recruiting moves in cycles, and the numbers being put on the board at UBS won’t go unnoticed. If we had to place a bet, at some point Morgan Stanley and Mr. Firestein will change his mind.

If/when that happens, expect private banker recruiting to absolutely explode.

Lies, Damn Lies, And Statistics – Merrill Claims They’ve Been Recruiting All Along, Also Claim Headcount Only Down 3%

In what looks to be a weak and feeble attempt to cover up the industry’s worst recruiting and retention record over the past few years, an unidentified Merrill exec claimed that the firm is jumping back into recruiting. That claim was then quickly followed by a statement that they never stopped recruiting – and then everyone laughed.

The quote that made the rounds in the media late last week intimated that Merrill would be making a ‘few hires’ this quarter and the next. The source attempted to make the giant leap that a ‘few hires’ in the next two quarters would signal that Merrill was the clear choice for advisors who serve HNW and UHNW clients.

Why did this source feel compelled to make such asinine claims? Merrill has been getting their teeth kicked in on the recruiting trail for the last five years. We did a little research, and check this out, 7 out of every 10 teams that have moved in the past 5 years that claim annual revenue better than $3M have left BofA/Merrill and went to a new firm.

Nobody believes that Merrill is about to score a bunch of noteworthy teams from rivals UBS, Morgan Stanley, or Wells Fargo (okay maybe Wells but that’s an article for another day). Any large team associated with a move and Merrill Lynch has been an exit, plain and simple. In 2018-2019, Stifel absolutely feasted on Merrill teams. Now, Rockefeller is doing the same, along with First Republic and indie firms.

All this amounts to is a misdirection play to take the industry’s eyes off the fact that Merrill’s real attrition rate with legacy advisors (not new bank hires and Merrill Edge) is closer to 10% rather than 3%. Give me a break. The smoke and mirrors are lame and nobody believes this ‘anonymous’ executive.

Our best guess is this – Merrill will probably announce a big private bank hire or two in the next couple of months. J.P. Morgan?? Maybe. Or possibly Goldman Sachs. That will serve as cover for this leak claiming that they are back in the recruiting game. **In fact that’s the only ‘team’ hire Merrill has made this year that we can find; a JPM PB hire in Texas.

Any team worth a damn in the industry wouldn’t dare go to BofA/Merrill. Why sign on to a small division of a bank that sees you as nothing more than a distribution center for loans and trust products?

Merrill would’ve done well to simply keeps its mouth shut. Now, we will be watching for their recruiting to come roaring back **rolls eyes**.