New Study Breaks Down The Industry To Show RIA Firms' Growth, Foreshadow Credit Suisse Layoffs

Thursday, July 28, 2011 06:50
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New Study Breaks Down The Industry To Show RIA Firms' Growth, Foreshadow Credit Suisse Layoffs

Tags: Merrill Lynch | Morgan Stanley | registered investment advisors | Wells Fargo

 

We all have a pretty good sense that the wirehouses are deflating, but it's worth pausing to check the numbers once in awhile -- especially when they preview big shifts in the marketplace.

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The Aite Group just issued its latest report on the wealth management space. As always evocatively titled ("From Dusk Till Dawn"), this one shows that the wirehouses never really recovered from the 2008 crash.

 

Instead, while the big four survivors -- BofA Merrill, Morgan Stanley Smith Barney, UBS, and Wells Fargo -- still control 38% of all the AUM out there, their client accounts are still 8% lighter than they were in 2007.

 

By comparison, independent RIAs still control barely 11% of the overall market, but their share is growing. RIAs have bumped up their books by 21% since 2007.

 

While Aite analysts say investors are still not sure about fee-based approaches, they note that the wirehouse model is taking a few more hits as the assets simply refuse to come back.

 

"Firms like UBS, Credit Suisse, and Bank of America Merrill Lynch are already rethinking their current staffing levels," co-author Alois Pirker says.

 

Indeed, Credit Suisse is widely expected to lay off about 1,500 people today.

 

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