BNY Mellon’s Pershing, which held assets in custody for the wealth management arm of the failed First Republic Bank, experienced significant outflows in the second quarter. These outflows almost offset its first-quarter gains. During this period, Pershing saw $34 billion in assets leave. Despite this setback, the unit’s total assets remained relatively unchanged from the previous quarter but showed a 9% increase compared to last year. This exodus of assets was a result of numerous advisors leaving First Republic due to its involvement in the banking crisis and subsequent sale to JPMorgan Chase.
Who Will be Part of the First RIA Megamerger?
The registered investment advisor sector has witnessed several significant mergers and acquisitions in recent years. However, the industry eagerly awaits the first megamerger involving two of the largest firms that have expanded through acquiring smaller firms. Many industry executives believe that it’s just a matter of time before such a megamerger takes place, as the economics of operating on a massive scale prove too irresistible. One potential combination that many industry insiders foresee is between Creative Planning and Mariner Wealth Advisors.
How to Navigate Higher Bond Yields
With Treasury yields currently at 15-year highs, income strategies are in focus. In our Big Q feature this week, we reached out to financial professionals to learn their thoughts on fixed-income strategies in the current landscape. The experts highlighted opportunities in TIPS, corporate bonds, and short-term Treasuries. However, one advisor cautioned against becoming too fixated on very short-term instruments.
Client Growth at Merrill Lynch
Merrill Lynch, a part of Merrill parent Bank of America’s wealth management channel, continues to experience significant growth. In fact, they added over 11,000 client households in the most recent period, marking a second-quarter record. This also marks the 26th consecutive quarter of growth in this measure. The overall strong quarter for Bank of America has exceeded analysts’ expectations, with a total of 19,099 advisors across its wealth management channel. Merrill Lynch alone added 190 advisors to contribute to this success.
Morgan Stanley’s Wealth Management Division Shines
While the second quarter may have been challenging for Wall Street giant Morgan Stanley, their wealth management division has shown impressive results. The division reported record revenue of $6.7 billion during this period, standing out as a bright spot. In fact, it accounted for over half of the company’s overall profits, with net income reaching $1.3 billion. This represents a significant 10% increase compared to the same period last year. Despite the overall decline in company profits, the wealth management unit continues to perform well.
Assisting Widows with Financial Management
Managing household finances can be an emotional trial for many clients, especially when dealing with the loss of a spouse who previously handled the family’s money. Our guest writer, an experienced advisor who specializes in supporting grieving women with their finances, offers valuable insights for financial professionals involved in similar situations. The key is to establish trust with the clients and empower them with knowledge. By doing so, advisors can help widows navigate this challenging aspect of their lives.
Q&A with Robertson Stephens CEO
In this week’s Q&A session, we had the opportunity to speak with Raj Bhattacharyya, the CEO of Robertson Stephens. This once dot-com era investment bank has successfully transitioned into a growing wealth management firm. With the support of private-equity firm Long Arc Capital, Robertson Stephens has witnessed remarkable growth, expanding their assets under management from $450 million to $4.6 billion in just 4½ years. Bhattacharyya also shares his journey to becoming CEO, despite not having prior experience in the industry.
Enjoy a relaxing weekend!