Even though UBS is losing some star reps to Morgan Stanley, it's recruiting enough talent away from Smith Barney to keep its net numbers up.
Over the last few weeks, UBS recruited 15 reps, including one team that grew up on the Smith Barney side of what's now the Morgan "family."
This cements a trend we've been seeing where disgruntled advisors from the old Smith Barney flee Morgan as that company ramps up to dump the Smith Barney name and absorb its partners outright.
Some of those advisors are going to UBS. Meanwhile, UBS is losing advisors back to Morgan Stanley -- specifically the new, merged entity -- and other firms.
This might look like wirehouse musical chairs, but follow the AUM numbers and the story gets clearer.
One of the most recent teams that UBS lost to Morgan Stanley had production of $6 million a year and we can estimate that AUM was huge, probably in the billions.
In return, the Swiss are getting teams that manage maybe $200 million apiece.
We can see this pattern with UBS' other recent recruits from firms like Oppenheimer and Merrill Lynch. While this recruiting keeps the overall number of advisors on course, on average the most recent batch managed $100 million apiece.
On average, existing UBS advisors manage $125 million apiece.
Of course, some of the incoming teams are pretty big, but they don't make up for the fact that the rest must be a lot smaller.
UBS can brag about its retention rate returning to pre-crisis levels all it wants. But we'll have to see if the overall AUM -- the thing that matters most to the immediate bottom line -- holds up as well.