UBS has been losing advisors for more than two years now. The firm has teetered on the brink of falling below the 6k headcount mark across the US for several quarters. Two years ago, that number was above 7k. Attrition at the firm, amongst its most productive advisors and teams, is a real problem.

In discussions with sources at the firm, the internal numbers are even worse. Currently, over the past year, only two managers in the entire country can claim a ‘net-plus’ number in headcount/recruiting. Even managers that have recruited well have lost more than they can bring in. Again (and to make the point clear), 95% of UBS branches and complexes have fewer advisors, assets, and revenue than they did a year ago.

And it’s about to get worse.

The revelation that UBS brass is seriously considering a merger with Credit Suisse (or any other potential sizable global bank) has the best and the brightest at UBS understandably spooked. Forget about the industry planted articles claiming that “not much will change for UBS Americas advisors in the event of a merger” – you know better than to believe that drivel.

Any serious industry veteran will tell you that a Credit Suisse tie-up will most certainly have ripple effects (at best) that are felt here in the US. Advisors could be forced to tie themselves to the firm with a fresh new retention deal, with plenty of non-protocol (read: non-compete and non-solicit language) legal hoops to embrace. And the value of the retention deal with be less than half as lucrative as any competitive recruiting offer. Comp will be adjusted down again in the coming years, management reduced (again), and the pivot to a private banking framework will be on the march.

The best and brightest at UBS understand this and are smartly evaluating their options. Meetings and phone calls have increased and the pipeline of firms like Rockefeller and the First Republic and bursting at the seams with UBS teams.

As a quick final thought for current UBS employees – do you think that Merrill Lynch advisors have enjoyed that last decade of changes at their vanishing brand? No, no they haven’t.