Wells Fargo continues to be the most aggressive ‘buyer’ in the wealth management recruiting market. And based on their current print in DC they just flexed their muscles again. Capping off a wild somewhat post-COVID recruiting weekend, Wells Fargo just committed more than $25M dollars in recruiting cash to a UBS team migrating to the competing bank. Again, the numbers only tell half of the story.
Per media reports:
“In suburban Washington, DC, Wells hired David Ciccone, Thomas Harsanyi, Robert G. Taylor and David N. Litman, senior vice presidents at UBS who a source said were producing $7.5 million on about $976 million of client assets. Daniel M. Allen, a fifth advisor who is a UBS vice president, remains at the firm where he was servicing clients with about $65 million of the team’s book, another source said.”
Mr. Ciccone and his team have spent a decade at UBS after migrating to the firm in the aftermath of the financial crisis. Before that they spent another half decade at Merrill Lynch (doesn’t everyone? lol). Migrating to Wells Fargo the team did leave a few bread crumbs behind, as the commentary above states, but nearly a billion dollars in client assets is set to transfer to Wells Fargo in short order.
Many advisors are taking the opening inside of the COVID-19 bubble to seek out new firms, and take advantage of an easier transferring of assets matrix. Clients are home, less busy, have become comfortable with Zoom calls and have gone deeper with technology over the past two months. Virtually signing transfer paperwork, and a rising market throughout all of May has made conversations that much easier.
Now to the dollars and sense – landing a team like this doesn’t happen with a ‘stock’ Wells Fargo deal. Generally the terms are pushed upwards and the hurdles and pushed downward. At a minimum you can assume a 350% deal was struck here which makes the topline number a heart warming $26.25M bucks. YEET! And it wouldn’t surprise us if the number is closer to $27M.
Suppose Mr Ciccone chooses to take the ‘retirement’ backend that Wells also offers advisors when they come on board. Choosing to retire at Wells Fargo, while the client assets and production remain, would put another 200-225% in Mr Ciccone’s teams hands. That would push a potential 10 year deal well beyond $40M dollars. Wow.
Just another day in the life of wealth management recruiting.
**Btw – there is a rumor out there that the real number that UBS lost in DC is closer to $13M with another potential team’s departure yet to be announced. Keep a sharp eye out for that announcement.