This podcast is called the tug of war banks versus financial advisors.
For years, there was a difference between banks and their products in their offerings, Merrill Lynch, UBS, Wells Fargo, Goldman Sachs, Morgan Stanley, Raymond James RBC, Hebert inquest, Alex Brown, Deutsche Bank. Lehman Brothers, Bear Stearns. And so each firm had their belly wet, right, they were had a certain cachet, and they certain products and services that differentiated the firm, as well as the advisor and his delivery to those products and services to his clients.
Well, we all know that over the years, banks and brokerage firms have become ubiquitous. The difference between one bank and another is really just there to provide a custodian with almost identical products and services, SMA structure products, alternative investments, and lending solutions, financial planning, and global investment solutions. At the end, it was the advisor, who was the differentiator, it was he or she that would provide the level of care and touch that made the difference.
And so when an advisor left, departed, one of these firms, historically, the, the retention rate of these firms was as high as 50%. Retention, like Goldman Sachs, and on average was around 70%. it took on average about nine months to up towards a year to bring over a solid 70%, if not upwards of 100 if that things have changed a lot. Again, banks are ubiquitous advisors are the differentiator. And what we’ve seen those last few years is that when advisors leave a platform, they’re bringing 100% of their assets in record time.
We’ve heard of moves that in 30 days, 100% of assets, we’ve seen 60 days we see 90 days, but the outliers are the six months or low or longer. But what’s the war? The war is banks still believe that your clients are at their firms because of them. And their differentiation.
We know that’s not true. And therein lies the war. Banks are putting in non compete clauses and deferred compensation is becoming more and more as a percentage of overall comp, garden leaves. Exiting protocol. They’re doing all sorts of things to make it difficult for you to move from your firm to another for your clients. Who’s winning the advisor because in the end, it’s your client. It’s your relationship. And it’s your delivery of your of your services that make the difference.
And that in lies why banks will continuously put handcuffs on you and trying to control your clients assets and businesses.
The tug of war between banks and financial advisors who’s winning! We know who!
As the Editor of The Gershman Group, a boutique financial services consulting firm, TGG brings expertise in financial analysis, strategic planning, and market research. With a keen eye for detail and a passion for helping businesses navigate complex financial landscapes, TGG delivers insightful, high-quality content to empower informed decisions. Backed by years of industry experience, TGG makes complex topics accessible through clear and compelling communication, shaping the firm’s thought leadership and commitment to excellence in financial services.
