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  1. 1. DECEMBER 1, 2008 SCATURRO TO LEAVE GOLDMAN VOL. XV, NO. 24 Peter Scaturro, ceo of Goldman Sachs Private Wealth Management, plans to step down at UBS $1B Team Heads year end to launch his own wealth management firm either as a startup or via acquisition. To RBC Scaturro, who did not return calls, has been seeking investors for what would likely be a RBC Wealth Management has boutique wealth management firm with a multi-family office component. He is also looking snagged a $1 billion team of advisors for executives to staff the effort, which will likely include former colleagues. Whether he has from UBS Wealth Management in talked to Frances Aldrich Sevilla-Sacasa, recently let go as president of Bank of America, US Phoenix Trust Private Wealth Management (see related story below), could not be determined. See story, page 2 (continued on page 12) Firms & Services Silver Bridge Signs On Development Head 3 WELLS NAMES WACHOVIA EXEC Baird Taps Teams From Merrill, UBS 3 TO TOP POST Glenmede Rolls Out Ad Campaign 4 Wells Fargo has appointed Wachovia’s David Carroll as HSBC Sponsors Design Fair 4 head of the combined bank’s wealth management United Capital Holds Webinar 5 efforts including brokerage services, private banking, Deutsche, NY Mag Prep retirement services, Wachovia Securities, investment Charity Gala 7 management and trust and estate services. Research A memo from president John Stumpf also says there will Affluent Picky About Terms 7 (continued on page 11) Obama Needs To Focus On Confidence 7 U.S. Trust Fading Away Family Office SEVILLA-SACASA OUT, MFO HEAD BOLTS Ashbridge Hires Wachovia Exec 8 Bank of America, U.S. Trust Private Wealth Management saw a number of top departures last week from the U.S. Trust side. President Frances Aldrich Sevilla-Sacasa fell victim to a Wining & Dining restructuring and Chris Zander, head of the multi-family office division, jumped ship to Knightsbridge Readies Holiday Bash 8 Manhattan-based Evercore Wealth Management along with several other senior staffers who Departments will reprise their current roles there. Guest Column 9 Metro-Atlantic Division Executive Alan Rappaport and head of credit and lending Bob On The Move 11 (continued on page 11) Heidi Nedwurth 12 COPYRIGHT NOTICE: No part of this publication may HSBC TO GROW CORE OFFICES be copied, photocopied or duplicated in any form or by Following a retrenchment earlier this year (PAM, 9/22), HSBC Private Bank is looking to any means without Institutional Investor’s prior written consent. Copying of this publication is in violation of the make a growth push in its remaining offices. It will look to hire teams of private bankers who Federal Copyright Law (17 USC 101 et seq.). Violators may be subject to criminal penalties as well as liability have clients with north of $10 million in investable assets. It will focus specifically on San for substantial monetary damages, including statutory Francisco, Los Angeles and New York, said Marlon Young, Manhattan-based ceo of HSBC damages up to $100,000 per infringement, costs and attorney’s fees. Copyright 2008 Institutional Investor, PB Americas. HSBC shuttered offices in Boston, Washington, Greenwich and Boca Raton. Inc. All rights reserved. ISSN# 726-98790 Young told PAM the firm will look to hire from private banks because bankers take a For information regarding subscription rates and electronic licenses, please contact Dan Lalor at more holistic approach with clients than brokerages. He declined to elaborate on targets in (212) 224-3045. (continued on page 11) Check www.iiwealthmanagement.com during the week for breaking news and updates.
  2. 2. Private Asset Management www.iiwealthmanagement.com December 1, 2008 At Press Time UBS $1B Phoenix Team Walks EDITORIAL PUBLISHING RBC Wealth Management has lifted the $1 billion Flader TOM LAMONT MIKE FERGUS Consulting Group from UBS Wealth Management in Editor Publisher (212) 224-3266 STEVE MURRAY Phoenix. The Flader Group is made up of brothers Allan, Michael and Brian Deputy Editor ARCHANA KAPUR Associate Marketing Manager Flader, and Chris Young, Jo Lane and Linda Caldwell. WENDY CONNETT (212) 224-3421 Executive Editor Allan Flader, speaking for the team, told PAM that he decided to move to (212) 224-3979 LAURA PAGLIARO Renewals Manager RBC because he was disheartened by the bureaucracy at his former firm and MARIANNE NARDONE (212) 224-3896 Managing Editor at large wirehouses overall. “I wanted a firm that had financial stability and, (212) 224-3610 VINCENT YESENOSKY Senior Operations Manager quite frankly, after 22 years of New York-based, Wall Street firms, I wanted KRISTEN OLIVERI (212) 224-3057 Reporter something different that was more stable with open architecture,” he said. (212) 224-3934 DAVID SILVA Senior Fulfillment Manager “To me RBC is the perfect in-between. There is a lot of flexibility but you MELISSA KARSH Associate Reporter (212) 224-3573 don’t have to worry about changing the ink in the copy machine or (212) 224-3255 SUBSCRIPTIONS/ STANLEY WILSON ELECTRONIC LICENSES negotiating a lease.” Washington Bureau Chief One year $2,585 (in Canada add $30 postage, others outside US add $75) Flader also told PAM that he had considered going the independent route (202) 393-0728 KIERON BLACK DAN LALOR before settling on RBC, and he predicts there will be more advisors moving from Sketch Artist Director of Sales (212) 224-3045 the big wirehouses to regional firms as well as those striking out on their own. PRODUCTION DMITRY MELNITCHOUK Compensation did not play into the rationale for moving from UBS, he said. In DANY PEÑA Account Executive Director (212) 224-3317 fact, the team took substantially less money upfront to go to a smaller regional LYNETTE STOCK, DEBORAH ZAKEN REPRINTS firm than if they had moved to another Wall Street firm or large wirehouse, Managers DEWEY PALMIERI added Flader. MELISSA ENSMINGER, Reprint & Permission Manager JAMES BAMBARA, DOUGLAS LEE (212) 224-3675 Calls to James Van Steenhuyse, Phoenix branch director, were not returned by Associates dpalmieri@institutionalinvestor.com press time. A UBS spokeswoman would only confirm the team’s departure. JENNY LO Web Production & Design Director CORPORATE GARY MUELLER ADVERTISING AND Chairman & CEO Glenmede Trust Launches Ad Campaign BUSINESS PUBLISHING JONATHAN WRIGHT CHRISTOPHER BROWN President Publisher Glenmede Trust has launched a national (212) 224-3566 STEVE KURTZ Chief Operating Officer marketing campaign. The print and radio ERIK KOLB ROBERT TONCHUK Editor, Business Publishing campaign is running in national and regional (212) 224-3785 Director/Central Operations & Fulfillment publications in Philadelphia, New York, PAT BERTUCCI, MAGGIE DIAZ, LANCE KISLING, ADI HALLER Customer Service: PO Box 5016, Brentwood, TN 37024-5016. Ohio and Delaware, said Susan Worteck, Associate Publishers Tel: 1-800-715-9195. Fax: 1-615-377-0525 UK: 44 20 7779 8023 BRIAN GOLDMAN director of marketing. These are locales were Advertising Production Manager Hong Kong: 852 2842 6910 E-mail: customerservice@iinews.com (212) 224-3216 the firm has a major presence. Editorial Offices: 225 Park Avenue South, LESLIE NG New York, NY 10003. Four print ads touting the tagline, There’s Advertising Coordinator Tel: 1-212-224-3979 (212) 224-3212 Email: mnardone@iinews.com no substitute for strength and stability, are Private Asset Management is a running in The Wall Street Journal and general circulation biweekly. No statement in this issue is to be construed regional publications. The spots feature text as a recommendation to buy or sell securities or to provide investment advice. that reads, We are Glenmede—an independent Private Asset Management ©2008 Institutional Investor, Inc. ISSN# 726-98790 investment and wealth management firm— Copying prohibited without the privately owned for over half a century. And, we permission of the Publisher. intend to stay that way. In small text at the bottom of the ad is director of Private Client Services, Chip Wilson’s contact information. Radio spots are also running through the end of the year. The firm tapped Boston-based agency Trinity Communications to create the ads, along with an internal marketing team led by Worteck. She declined to comment on the price tag for the campaign, and noted the firm is considering launching a multi-media including TV ads campaign for 2009. 2 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  3. 3. December 1, 2008 www.iiwealthmanagement.com Private Asset Management Firms & Services Silver Bridge Adds landscape may look different with an increased number of smaller boutique shops, multi-family offices and breakaway Development Head brokers. “I believe that market share wise a lot of the wealth will Wealth advisory boutique Silver Bridge start to move to the smaller boutiques simply because of supply Advisors has signed on Deirdre Prescott as and demand. Clients will be willing to trade in the stability [of director of client development. Prescott joins the larger firms] for personalized service and subjective from Lehman Brothers Private Investment information,” he said. Management unit, where she was an advisor with $300 million in assets under management. Baird Grabs $600M From Deirdre Prescott Prescott told PAM she was attracted to Merrill, UBS Silver Bridge because the firm is in growth mode and enhancing Robert W. Baird’s Private Wealth Management Group has its technology capabilities. “It’s kind of interesting when you are nabbed more than $600 million in assets under management in at any of the wirehouse firms, you do get offers that will pay a two separate teams for its Scottsdale, Az. office. The LPBS multitude of revenues and I just wasn’t interested in making a Group, made up of former Merrill Lynch financial advisors move like that—and be tied to a firm for a period of five to seven Michael Lyons and Daniel Peter, Andrew Brinkman, Matthew years and selling my clients,” said Prescott, who was also attracted Sonder, Ted Sweeney, portfolio specialist, and assistants Maggie to the equity ownership at Silver Bridge. Voight and Meghan Cyr, joins with $425 million in AUM. In a Prescott’s hire is part of the Boston-based firm’s recruiting effort separate move, the Hawley/Chandler Group, which includes and plans to expand its reach on the East Coast (PAM, 10/3). financial advisors Vince Hawley, James Chandler and Joe Christ and client relationship associate Jacque Decker, joins from UBS Dollars And Cents with $205 million in AUM. Affluent Concerned With The team additions coincide with the completion of an office expansion in Scottsdale. “In a market where firms are Losing Wealth struggling and losing brokers we are expanding, remodeling Nearly half of wealthy investors, those with $1 million or more and adding,” said Mark Peterson, market manager for in investable assets, are worried about losing money—the most Arizona. Peterson, told PAM that both Arizona offices doubled paranoid being the ultra-wealthy, according to a Dow Jones in size to accommodate the addition of 15 advisors in its Webinar called Save Your Book of Business: What the Wealthy Phoenix and Scottsdale offices. “In Scottsdale we don’t have Really Care About. much room left as we do have a commitment for another Robert Frank, wealth reporter for the Wall Street Journal, said individual to start in early December, and another large team the unprecedented amount of fear amongst the wealthy is the from a major wirehouse looking to come in mid-January,” he result of the wealth management industry’s inevitable said, declining to elaborate on the new additions. contraction in the short term. “We are moving from an age of Peterson said that many new recruits have been attracted to conspicuous consumption to conscientious consumption— the fact that the firm is privately and employee owned, which where the wealthy want products that are more quiet and subtle eliminates the “headline risk.” Peterson declined to comment and the aim is more about meaningful things that would not on specific compensation packages, but said in general the deals rub wealth in the face of others,” he said, adding, “There is a at Baird are much less than those of some of the major shift from indulgence to health and wellness and more of a focus wirehouses. Within the last year, Baird launched its first WM away from [GM] Hummer type vehicles to the [Toyota] Prius office in northern California, has added veteran financial and other more conscientious ways of traveling such as buying advisor teams in Minnetonka, Minnesota, Reston, Virginia, carbon offsets with private jets.” Frank said the wealthy are now and plans to expand to Nevada, greater Philadelphia, Baltimore putting their money into cash, gold, land and champagne and other geographic areas (PAM, 7/24). Peterson said the firm investments. Liquidity has become the new status symbol of will grow its Tucson, Az. office next year, which currently today’s wealthy, he said. employs one financial advisor. Frank said there will be renewed growth in the wealth A UBS spokeswomen confirmed the departures. Calls to management industry in about three to five years and that the Merrill were not returned by press time. To receive email alerts or online access, call 800-715-9195. 3
  4. 4. Private Asset Management www.iiwealthmanagement.com December 1, 2008 Firms & Services (cont’d) Colorado Firms Partner HSBC Sponsors Miami The G5 Financial Group, a Colorado-based advisory group, Design Fair has joined forces with Denver-based Geneos Wealth HSBC Private Bank, in conjunction with its role as principal Management. G5 Financial was part of the independent sponsor of art convention Design Miami/, is showcasing the brokerage division of American International Group. “G5 talents of high school student designers at Miami-based wanted a firm that was smaller and had a different culture Design and Architecture Senior High (DASH) on than AIG,” said Ryan Diachok, v.p. of marketing and December 3-6. HSBC asked senior students from DASH to business development for Geneos. “We are helping to reshape design environmentally friendly dresses to be showcased at the industry for elite independent financial advisors.” G5 the fair. manages approximately $580 million for high-net-worth During the fair, HSBC PB lounge will host clients and guests client throughout Colorado. to display a new collaboration with Fernando and Humberto Recently, Geneos has hired several advisors who are looking to Campana, winners of the Design Miami/ 2008 Designer of the go independent, and plans to continue expanding. Geneos has Year Award. Throughout the fair, a documentary film HSBC PB 260 advisors throughout the U.S. and $7 billion in assets under produced with (www.Dezeen.com) featuring the Campana management, and G5 has 25 advisors. brothers will be playing. Marlon Young, ceo of PB Americas, said this is a great opportunity for HSBC to encourage young designers and entrepreneurs to enhance their talents and network Risk Management, Asset Allocation with industry veterans. Top Priorities Design Miami/ is the largest forum for international Odyssey Financial Technologies, a global design, bringing together leading designers, collectors, dealers, provider of private wealth products and curators and critics from around the world. HSBC Private services, has released a white paper stating that Bank provides banking and trustee services with 90 private banks and wealth management firms international locations. need to focus on asset allocation and managing risk as top priorities. The firm rolled out Rivals Pick Top Merrill Crop Consequences of the 2008 Financial Crisis on Although Bank of America managed to keep 6,200 of the Didier Pitton Private Wealth Management to outline areas in 6,600 top Merrill Lynch producers who were offered retention wealth management that are most affected by the market turmoil. packages, according to published reports, more than 120 fled Authored by Didier Pitton, Lausanne-based product the coop last week. Morgan Stanley, UBS and Smith Barney marketing director, the white paper says that firms most need picked up dozens of brokers who chose not to sign retention to help clients understand risk after five years of relatively deals by the Nov. 14 deadline. A spokeswoman said that the smooth financial sailing. “In the last two months many clients 10,000 brokers who were not offered retention pay are also have lost money in some financial instruments, including expected to join BofA. Recruiters argue that hundreds more are money market funds where they didn’t think so much risk was expected to depart in the coming weeks as Merrill’s rivals are at stake,” said Pitton. The paper discusses the importance of dishing out the cash for the thundering herd. A BofA transparency of structured products for clients, and providing spokesman did not return calls by press time. true asset allocation and foreign investment diversification for Morgan picked up 15 Merrill Lynch brokers with over U.S.-based clients. “There is not enough diversification into $921 million in assets under management and $14 million in emerging markets, European equities and fixed income production. One of the teams—Charles Bird, Tracy Bird and markets,” he said. John Rocco —was at Merrill for a total of 25 years. The team Pitton added that transparency is paramount for the has $2.6 million in production and $260 million in assets industry because traditionally, wealth advisors were being under management. Five brokers with $673 million in assets compensated by the amount of products they sold compared under management and $4.6 million in production went to to the quality of service they provided. “Relationships will UBS. Two teams with a combined production of over $2.5 make a difference, and the concept of a trust advisor is more million and $193 million in assets under management moved important then ever,” said Pitton. to Smith Barney. 4 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  5. 5. December 1, 2008 www.iiwealthmanagement.com Private Asset Management “Morgan Stanley and UBS were offering the top packages on Wilmington, Del. and Beachwood, Ohio. Alimansky referred the Street and they were able to get some of the top guys that calls to the spokeswoman. didn’t like the package terms,” said George Jones, a New York recruiter. Smith Barney may be lagging behind because of the firm’s financial turmoil and layoffs. A Smith Barney manager Deutsche Bank, NY Mag Co-Host said the firm is “trying to do more with less.” At press time Charity Gala Friday Citi CEO Vikram Pandit said Smith Barney would not Deutsche Bank, together with New York Magazine, is hosting a be sold off. 10th anniversary party at Christie’s to benefit the Room To Morgan Stanley has been offering $2.6 million to $1 million Grow charitable organization. producers to jump ship. A spokeswoman for Morgan could not The evening gala reception, slated for December 2, will comment on details of the package but said it will continue to invite roughly 400 clients and friends of the sponsor firms remain competitive. A West Coast recruiter said that UBS will including board of directors members Princess Alexandra of stop offering its generous recruitment package by next week. The Greece, David Heleniak, vice chairman of Morgan Stanley, package had offered $2.4 million to $1 million producers, with and Rachel Mauro, founder of Rachel Mauro Fine Arts in half paid upfront. A UBS spokesman could not comment on Manhattan. The event will kick off with a cocktail reception, compensation matters. Smith Barney’s package is on par with dinner, and a silent and live auction, with proceeds benefiting UBS and Morgan. Manhattan-based Room to Grow, which works with babies and their caregivers born into poverty, said executive director Schiff Hardin To Host Estate Lexy Mayers. The organization provides one-on-one parental support, essential items and toys, and healthcare during a Planning Teleconference child’s first three years of development. Private client law firm Schiff Hardin will host a teleconference Uma Thurman, chair of the Gala, will also address attendees. about recent developments in estate planning, highlighting issues Costs of the event could not be determined. including charitable giving, asset protection, insurance and estate administration. The Manhattan-based firm’s Private Clients, Trusts & Estates Group will host the teleconference, ABA Recent United Capital Hosts Business Developments in Estate Planning, on December 4, to be run by Owner Webinar partner John Dadakis. Wealth management firm United Capital Partner Thomas Abendroth and Skip Fox, partner with law Financial Partners hosted a Webinar session firm McGuire Woods, will also lead the teleconference, which on Nov. 21 on maximizing the value of a will include a discussion on marital deduction and gifts. Schiff business, designed for wealth management Hardin has rolled out several seminars this year, the most recent firms and family business owners. discussing open architecture (PAM, 10/20). Newport Beach-based United Capital, run by ceo Joe Duran, has grown through Joe Duran acquisition of smaller U.S. wealth Glenmede Taps Hedge Fund Exec management firms—after Duran predicted last year that firms Philadelphia-based Glenmede Trust has would look for more merger opportunities because of a tapped Benjamin Alimansky in the newly- downturn in the financial markets (PAM, 12/3). The Webinar, created role of first v.p., managing its hedge called “How To Maximize The Value of Your Practice,” funds and investment strategies. Alimansky discussed the steps to take to increase business value, and how joins from Brooklyn NY Holdings where he to take advantage of current markets and industry changes to was a senior v.p. and portfolio manager. add value. The Webinar will also break down succession Alimansky, who reports to Gordon planning steps and how to prepare for changes to ownership. Benjamin Alimansky Fowler, cio, was brought on to help with “Whether you plan on selling now, five years from now or the firm’s Manager Alliances Program which evaluates never, you will leave with information you can use to increase externally managed investment products for its high-net- your practice’s value immediately,” Duran said, adding that the worth clients, said a spokeswoman. seminar should be valuable regardless of whether the firm plans Glenmede has roughly $16 billion in assets under advisement to liquidate. United Capital’s footprint markets include Florida, with additional offices in Princeton and Morristown, N.J., Texas and Connecticut. To receive email alerts or online access, call 800-715-9195. 5
  6. 6. 2009 Advisory Board & Speaking Faculty Includes: Social Investment Forum members are entitled to a special discount! Call 1.800.437.9997 for approval today. Laura Berry, INTERFAITH CENTER ON CORPORATE RESPONSIBILITY (ICCR) KEYNOTE ADDRESS Marc Fox, GOLDMAN SACHS The Role of Corporations in International Human Rights Keith L. Johnson, FORMERLY STATE OF WISCONSIN INVESTMENT BOARD; REINHART INSTITUTIONAL INVESTOR Special Representative of ; Pro- SERVICES; NETWORK FOR SUSTAINABLE FINANCIAL MARKETS fessor, Harvard Kennedy School of Government; Michael Lent, EDWARD W. HAZEN FOUNDATION Jack McGourty, COLUMBIA UNIVERSITY Drummond Pike, TIDES FOUNDATION PLUS! New Workshop: Luther M. Ragin, F.B. HERON FOUNDATION Howard Rifkin, STATE OF CONNECTICUT A Practical Guide to the UN Principles D’Artagnan Scorza, UNIVERSITY OF CALIFORNIA for Responsible Investment (PRI) Morgan Simon, RESPONSIBLE ENDOWMENTS COALITION Dr. Jeffrey L. Sturchio, MERCK & CO., INC. Toni Symonds, CALIFORNIA STATE CAPITOL; FORMER STATE Other Featured Speakers Include: CONTROLLER REPRESENTATIVE TO THE CALPERS AND CALSTRS BOARDS Stephen Viederman, CHRISTOPHER REYNOLDS FOUNDATION; THE NEEDMOR FUND ...AND MORE! To Register 1.800.437.9997 or 212.224.3570 registration@iievents.com LOS ANGELES FIRE NEW YORK CITY TIAA-CREF THE NATHAN CUMMINGS www.iievents.com/RI AND POLICE PEN- EMPLOYEES FOUNDATION SIONS (LAFPP) RETIREMENT SYSTEM (NYCERS) A UNIFI Company taking the environment into account
  7. 7. December 1, 2008 www.iiwealthmanagement.com Private Asset Management Research Management is based on telephone interviews with about 503 Affluent Disapprove Of Wealth affluent households, with a net worth of $500,000 or more, Management Term between June and July, 2008. Nearly half of affluent households do not feel comfortable with the term “wealth management,” according to a study by Wealth Managers To Obama: Restore Spectrem Group. Affluent households Investor Confidence are defined as having a net worth of $500,000 Wealth managers say the Obama or more, but as the level of wealth increases administration’s primary task with regard to the term “wealth management” is typically their client’s finances is to restore investor Tom Wynn employed. confidence, according to a SEI Private Tom Wynn, director of the Spectrem Group, told PAM Banks poll taken the day after the election. that some people feel the term “wealth management” is too SEI polled about 22 wealth managers from elitist. Of those surveyed 41% said they strongly disagreed or bank and trust institutions who attended its Jim Morris disagreed that the term “wealth management” appeals to Private Banking Asset Management them; 26% were neutral; and 34% agreed or strongly agreed Symposium in Denver. Roughly 88% of those polled chose that the term did appeal to them. Of those surveyed with a restoring investor confidence as the new administration’s first net worth less than $1 million, 26% strongly agree or agree task, said Jim Morris, senior v.p. private banking. that the term is appealing to them; 32% are neutral; and 42% Morris told PAM that SEI looked particularly at tax policy. disagree or strongly disagree that the term “wealth Of those polled, 100% said that with President-elect Barack management” is appealing. Obama ready to raise capital gains tax, they would advise Wynn said he was surprised clients to consider tax-managed strategies, with 44% saying to find that some surveyed they have already incorporated those strategies for clients and were not aware that their the remaining 56% saying they plan to do so. primary provider of Of those polled, 50% expect their clients to be financial services offered negatively impacted by Obama’s policies, 38% were unsure a wealth management whether his policies would have a positive or negative program. Of those impact and 12% said they expected a positive impact. “The surveyed, 63% said dominant message of this is for wealth managers and they knew that their wealthy clients to take a look at three things—are your primary provider offers a investment strategies aligned with your goals, do you have wealth management program the right level of diversification and professional management and only 43% are currently involved and are you taking advantage of tax-managed strategies in in such a program. The Affluent and Their Perception of Wealth your portfolio,” said Morris. GET IT FRIDAY! Paid subscribers now have access to a PDF of the upcoming Monday’s newsletter on PAM’s Web site every Friday afternoon before 5 p.m. EST. That’s a 64 hour jump on mail delivery, even when the post office is on time! Read the news online at your desk or print out a copy to read at your leisure over the weekend. Either way, you’ll be getting our breaking news even sooner and starting your week off fully informed!
  8. 8. Private Asset Management www.iiwealthmanagement.com December 1, 2008 Family Office Going To The Dogs… Steel, to become more aggressive in courting new business and retaining top clients. Highmount Throws Charles Grace, ceo, told PAM that Knott is now dealing with Philanthropic Event the firm’s five top clients as well as supervising the other client Multi-family office advisors on staff and overseeing business development. “Bill now Highmount Capital has the most important job in the firm,” said Grace, noting that held a “Day of the firm was looking for a major industry player with enough Philanthropy” to stature to deal with ultra-high-net-worth clients. Knott has also encourage charitable been appointed to the executive committee comprised of Grace, giving among children of David Donabedian, cio, and Charles Grace III, managing its clients. The event, director. Knott confirmed his appointment. launched in response to The MFO, founded over 40 years ago, caters to families requests from clients, with more than $20 million in assets under management. was held at the ASPCA Gary Teigman and David Glaser at ECG Resources Highmount Capital Event in Manhattan. conducted the search. The event, held Nov. 5, invited 15 adults and their children, ages six to 12, to look at ways to find their service Wining & Dining interests, even at a young age, as well as how to research The wealth management industry’s soft marketing charitable organizations and identify various ways to start and client retention activities. giving, said Darcy Bhatia, partner at Highmount. Costs could not be determined. Knightsbridge Preps Ashbridge Hires Annual Holiday Bash Knightsbridge Advisors will host its fourth annual holiday Wachovia Exec party Dec. 11th in Midtown Manhattan. The search firm will Ashbridge Investment Management, a multi-family office invite roughly 200 clients, intermediaries and friends of the based in Philadelphia, has hired Bill Knott in a newly- firm for cocktails and a three-course dinner at French created role of chief relationship officer. Knott was tapped restaurant Madison Bistro. from Wachovia where he was regional president for Allan Starkie and Steve Wade, partners of the firm which also Wachovia Bank’s greater Philadelphia and Delaware Region. focuses on mergers and acquisitions consulting, will host the The hires mark a move by the MFO, originally founded by event which will include live entertainment and bag pipes. Costs the Grace family, which made its fortune in Bethlehem could not be determined. iisearches posted over $3.5 trillion in new search leads in 2007... The world's number one sales and marketing tool for investment managers ...grow your business with the latest daily search leads. For further information on iisearches’ daily search leads and searchable database of search-and-hire activity since 1995, visit www.iisearches.com or contact Keith Arends in New York at 212-224-3533 or at karends@iinews.com, or Ben Grandy (Europe and rest of the world) Tel: +44 (0)20-7779-8965 or at bgrandy@iinews.com
  9. 9. December 1, 2008 www.iiwealthmanagement.com Private Asset Management GUEST COLUMN The Changing Face Of Today’s Wealth Management Business By Anthony Riotto In today’s changing wealth management feel guilty about not being able to service their clients properly. business, the client is relying on the The relationship manager is leveraged to a breaking point. relationship manager more so than ever to Culture clashes are caused by merging companies with have a clear understanding of their different philosophies and business models. Relationship objectives, and the technical expertise to managers struggle with these differences. This was obvious with drive their strategies. Since they are crucial to recent mergers in the space that forced relationship managers the success of the firm, the competition for from a customized wealth management approach to a one-size- Anthony Riotto talented relationship managers is the most fits-all model. intense among trust banks, private banks, brokerage firms, registered investment advisors, family offices, and multi-family Relationship Manager Woes offices. The relationship manager’s value is further enhanced Some relationship managers find their focus is overly internal, because the clients’ discontent levels increase when their advisor rather than with the client or prospects. They are bogged down leaves the firm—a frequent occurrence in the last two months with an overbearing process, excessive internal meetings, and the as more advisors head for independent firms or boutique shops. inability to gain access to specialists. Often, decision-making is too In 30 years of recruiting wealth management professionals, I bureaucratic, at the expense of competitiveness and client service. have asked one question thousands of times when an executive When the wealth management organization is a part of a wants to switch firms: “What is your motivation for considering larger financial institution, resources for the wealth a move?” The answers allow me to understand the candidates’ management group are often limited. Bonuses may be perceptions, values, and sincerity. Here’s what I’ve learned: nonexistent if the larger parent experiences a financial mishap. The best relationship managers are devoted to their clients. Relationship managers want to be appreciated as well as They experience anxiety when they perceive that corporate recognized. Relationship managers thrive when given the decisions are in direct conflict with the best interests of their opportunity to participate in corporate decisions. Corporations clients. An example is putting sales quotas on specific products, thrive when they exploit the relationship manager’s understanding which present a direct conflict. The problem is, “if I’m not of the client to create policies, products and services. pushing a product, my own annual review and bonus will suffer” All of the major service providers have experienced decreases while the other side of the concern is, “I might lose my client.” in revenue, but some wealth management boutiques have had These are tough choices. If they give in to the pressure of the substantial gains in new business revenues and are seeking organization, the relationship manager often feels a loss of seasoned relationship management talent. professional integrity. National registered investment advisory firms are starting Compensation must be fair and competitive. It’s worth new companies and providing entrepreneurial relationship noting that few relationship managers made compensation their managers with the opportunity to start their own firms with primary motivation for changing firms. $10,000, $20,000, or significant ownership. This can be very attractive since the even $50,000 is not enough of an incentive to recruit an parent company can provide cutting edge products and the individual to an organization that doesn’t truly understand and centralized support and services of a national platform. deliver a value-added proposition around wealth management. Using the flourishing single-purpose wealth management Conversely there is often a willingness to consider the potential boutiques as the inspiration, I believe we will see a new breed of of an increase in compensation, yet not an increase on the spot, independent wealth managers that will be small, when moving to an organization with the right philosophy. entrepreneurial, more client focused, more personalized, and When profit margin supersedes providing quality client with less interest-clash and bureaucracy. service, the result is inadequate technology and insufficient and poor quality support. This translates into late nights and some Anthony Riotto is the Founding Partner of New York-based weekends for those relationship managers who care. Riotto-Jones, a national wealth management consulting and Workloads are often excessive. Many relationship managers search firm launched in 1982. To receive email alerts or online access, call 800-715-9195. 9
  10. 10. Private Asset Management www.iiwealthmanagement.com December 1, 2008 On The Move • Boston-based wealth management boutique Crestwood $105 million in AUM. Smith Barney also hired the Rahm Group Advisors has promoted Leah Cadillac to partner. She now is from Morgan Stanley for its Madison, Wis. office, which responsible for relationship management, operations includes Stig Rahm and Patrick Rindfleisch who join with management and financial planning. $140 million in AUM. Lastly, Smith Barney has nabbed the team of Tim Foster and Preston Rigsby from Morgan Stanley • Lehman Brothers lost Steven Mitchell to UBS Private Wealth for its Lubbock, Tx. office, joining with $116 million in AUM. Management in New York. Mitchell joins with north of $250 million in assets under management. • Merrill Lynch has hired brothers Michael and Benny Varzi from Morgan Stanley for its Atlanta, Ga. office. The Varzi’s join • J.P. Morgan’s Private Wealth Management division tapped with about $400 million in AUM. Andrew Barnes as an investment advisor in the New York office. Barnes is responsible for working with high-net-worth individuals • Barclays Wealth Management has hired Zamir Siddiqi as an and families on investment strategies based on risk tolerance and advisor in its Los Angeles office. Siddiqi joins from Bernstein long and short term financial goals. He joins from Bernstein Global Wealth Management where he was a principal and advisor. Global Wealth Management where he held a similar role. • Deutsche Bank has nabbed Pierre Economacos, advisor and managing director, and partner John DeLappe from UBS in • Smith Barney has hired Joe Phillips from Morgan Stanley in Miami. The pair joins with about $500 million in AUM. Boston. Phillips joins with $109 million in AUM. Smith Barney has also brought on Joseph Ricotta from JP Morgan for its 153 • Baird has launched its first Wealth Management office in East 53rd Street office in New York, joining with $125 million in California and hired four to staff the hub. Carlos Alcaine, Joseph AUM. Smith Barney has tapped the team of Shannon and Lisa Hoon, Seth Kaplan and Stephen Halterbeck have been brought Glor from Merrill Lynch in Tampa. The Glor’s join with on as advisors in the Roseville, Calif. hub. Alcaine, Halterbeck Corporate Access Program Get instant, online access to Private Asset Management for everyone in your firm. This Corporate Access Program (CAP) is being offered now for ONE PRICE — Call now to get your discount and start your firm’s subscription to www.iiwealthmanagement.com. Your CAP Subscription Includes: > Bi-weekly email updates available exclusively to subscribers > Breaking news sent to each designated person at your firm > A cost-effective way to disseminate information > Protection against copyright violations — your firm is protected > Mobile-friendly website coming soon > Blackberry-friendly email delivery coming soon Private Asset Management – Critical Intelligence for the High Net-Worth Arena FOR MORE INFORMATION PLEASE CONTACT: Dan Lalor | 212.224.3045 | dlalor@iinews.com
  11. 11. December 1, 2008 www.iiwealthmanagement.com Private Asset Management On The Move (cont’d) and Kaplan all join from Wachovia Securities, where they were Merrill Lynch for its Novi, Mich. office. The team joins with advisors and Hoon hails from Bank of America. The Milwaukee- $520 million in AUM. based firm plans to open more offices in Northern California next year, and the team reports to branch manager Andy Fass. • EFG International has launched a Los Angeles office and hired Amira Matar as senior director of wealth management. Matar joins • Raymond James & Associates has hired Gerry Saelzer and from Bank of America in Los Angeles, and brings her background Jeff Atlas from Wachovia/A.G. Edwards for its Stuart, Fla. in working with prominent clients particularly in the Lebanese office. Saelzer and Atlas join with $300 million in AUM. community to the new post. She will work to grow business in this Raymond James has tapped Steve Crabtree from UBS for it niche as well as within the Middle East community, and is active in Franklin, Tenn. office. Crabtree joins with $180 million in Lebanese-American philanthropic organizations. AUM. Raymond James also nabbed the team of Nadine Wilkes and Paul Weinstein from UBS for its Fort Myers, Fla. office, • RBC Wealth Management has appointed Brenda Vice as head who join with $400 million in AUM. The firm has brought on of Wealth Management Strategy. Doug Coulter, president and the team of Barry and Ty Bernicke from SII Investments for its ceo of RBC Direct Investing, will take over Vice’s current Eau Claire, Wis. office, who steps in with $219 million in position as president of RBC Asset Management. The new AUM, and tapped Charles Nemes and Timothy Rush from appointments will go into effect on February 1, 2009. HSBC PLOTS 6/2). Executives familiar with both firms are saying there is no way both management teams will be kept on following the merger, and (continued from page 1) most believe the Dowd/Scaturro Wachovia team will survive. terms of people or assets under management growth. The bank, Calls to Duchala, Dowd and Scaturro were also not returned. which views wealth management as a strong spot despite the Calls to Carroll were referred to a spokeswoman who would only current market downturn, hopes to capitalize on the current confirm his appointment. —Kristen Oliveri market volatility that has left many bankers unhappy with their current institutions. Young also said he believes many private banks and wealth SEVILLA-SACASA management firms will be reevaluating in-house services like (continued from page 1) philanthropy because of the slowdown in this area, which had Lynch, who both reported to Sevilla-Sacasa, have also been let go been on a roll in recent years. HSBC’s philanthropic services are as part of the restructuring. The trio’s roles have been taken over handled mainly out of its Multi-Family Office group, which by Keith Banks, ceo and president of BofA’s Global Wealth & includes advisors with a specialty in philanthropy but who are Investment Management unit. According to an internal memo, not focused solely on it. —K.O. Banks is “streamlining certain U.S. Trust division areas to position for greater growth.” The restructuring is also a way to WELLS NAMES cut legacy UST posts ahead of BofA’s pending merger with (continued from page 1) Merrill Lynch, said people familiar with the firm. be more announcements regarding upper management changes. Evercore, which launched last week as a division of Evercore Carroll is head of Wachovia’s Capital Management Group. Partners, snatched seven other staffers, including Karen Francois, Jay Welker, executive v.p. based in San Francisco, currently head of the New York City trust team. These moves are unrelated to runs Wells Fargo Wealth Management Group which includes the restructuring, according to executives familiar with the group. Private Client Services and the Private Bank. Calls to Welker Jeff Maurer, former chairman and ceo of Lehman Brothers were not returned. Trust Company who left in 2007, will run Evercore WM. Prior to the merger, Wells Fargo named John Duchala as head Maurer also has a history with UST, where he was vice chairman of the Northeast region and has made a push there, marking its and cio before taking the post at Lehman. first Northeast presence (PAM, 9/22). Wachovia Wealth Zander did not return calls and Sevilla-Sacasa had left the firm Management brought on John Dowd, formerly head of wealth and could not be reached. Belinda Sneddon, an executive within management in New York, and Thomas Scaturro, the former head UST’s MFO division, has been named interim head following of sales for the tri-state area with BNY Mellon Wealth Zander’s departure, according to a BofA spokesman. He declined to Management, to beef up the firm’s New York presence (PAM, elaborate on additional replacement plans. —M.N. & K.O. To receive email alerts or online access, call 800-715-9195. 11
  12. 12. Private Asset Management www.iiwealthmanagement.com December 1, 2008 SCATURRO TO Quote Of The Week (continued from page 1) “It’s kind of interesting when you are at any of the wirehouse firms, Scaturro joined Goldman last year from U.S. Trust, where he you do get offers that will pay a multitude of revenues and I just was ceo (PAM, 7/16/07). Prior to that he was a senior wealth wasn’t interested in making a move like that—and be tied to a firm official at Citigroup. A Goldman spokeswoman declined to for a period of five to seven years and selling my clients.”—Deirdre comment on possible replacement plans. Prescott, director of client development with boutique advisory Silver —Marianne Nardone Bridge Advisors, discussing her reasons for joining the Boston-based shop from Lehman Brothers (see story, page 3). Correction Patricia Angus, head of Angus Advisory Group, works with One Year Ago In Private Asset Management families with $50 million and above. Angus is a strategic advisor to Shelterwood Financial Services, but does not share clients • Neuberger Berman launched a re-branding initiative of its Private Asset Management Advisory Services division, renaming and is an independent advisory. A story in PAM’s 11/17 issue it Neuberger Berman Wealth Management. Alison Deans was incorrectly stated this relationship. brought on internally to run the division. [Deans was tapped to replace Jack Rivkin, cio and head of Neuberger Berman Private Asset Management, who stepped down (PAM, 6/16).] HEIDI NEDWURTH’S • Credit Suisse launched its first private banking presence in India. Puneet Matta was hired from Citigroup, where he was NOTES country business manager, to run the new operation. Heidi Weighs In On Mistress Downsizing Five Years Ago My iPhone has been buzzing with calls from my philandering friends after many of their ultra-wealthy • Bryn Mawr Trust launched its first national brand campaign in an effort to make the large regional trust company a men-on-the-side have called it quits or cut off their household name in wealth management. [Bryn Mawr has since unlimited spending just before the holiday season. launched the Bryn Mawr Trust Company of Delaware, a Heidi was able to back up this trend, which is hitting limited purpose trust company in Wilmington, Del., to expand Manhattan and beyond, after reading the latest survey the firm’s footprint nationally and internationally (PAM, 11/13).] by Connecticut-based Prince & Associates. The salty survey says that more than 80% of multi- • UBS Financial Services had plans to roll out a private banking effort in the U.S. to target family offices with credit services and millionaires who have extra-marital lovers plan to cut European investment management. back on their gifts and allowances to their female gal pals. The good news, I guess, is that the study says that only 12% of the multi-tasking multimillionaires plan For More Benefits Visit Our Web Site to let their part-time lovers go altogether. As a Private Asset Management subscriber, you’re entitled to access So some might’ve escaped the chopping block for Private Asset Management online at www.iiwealthmanagement.com. Go now—but perhaps should be setting up more lucrative to www.iiwealthmanagement.com and get the following added BENEFITS: arrangements on the side. “Rich people are getting hit, • Breaking News E-mail Alerts—get critical industry news as it and they’re all expressing the need to curtail unnecessary breaks spending. Lovers are part of the same calculation,” said • Live Web Updates—new stories posted in real time throughout Russ Prince, president of Prince & Associates. Heidi the week. never has to worry about such low-brow things as she • Earlier Delivery—each issue of Private Asset Management is available in full on the website the Friday before it comes out by 5pm only dates billionaire bachelors who vow never to EST. marry. As for the methodology, the study was quick to • Remote Access—get industry news no matter where you are by note it screened out the one-night-stands and focused simply acessing www.iiwealthmanagement.com. solely on wealthy men with a net worth of $20 million, DO NOT MISS OUT! who said they had lovers of at least a year or more. Set up your subscriber password today Simply contact us at customerservice@iinews.com or call us at 1-800-715-9195. 12 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.