Ameriprise Thaws A Tiny Bit On "Progress" In Securities America Negotiations
- Created: Sunday, 27 March 2011 22:38
Depending on whether you count the preamble as part of the statement or not, Ameriprise has now committed either 27 words or a full 63 words to explaining to the investing public and the industry exactly what it is doing to save the sixth-largest brokerage network in the country:
(quoted in full)
"Ameriprise Financial has been working with Securities America, Inc. (SAI), an independent subsidiary of Amerprise, and plaintiffs to help SAI resolve legal matters related to sales of Medical Capital and Provident Royalties securities. Ameriprise Financial today issued the following statement on the matter:
"The parties have made substantial progress and have committed to a process that we are hopeful will result in a full and final resolution of the matters."
Coming close to a week after Ameriprise issued a statement to soothe its shareholders, the gesture may look both late and incomplete to those who were hoping for a conclusive display of support for Securities America and its 1,800 advisors, not to mention its clientele.
However, "substantial progress" is better than nothing, and given the taciturn nature of Ameriprise's recent approach to this situation, must be truly significant in order to rate mentioning at all.
Word has it that the advisors themselves have been privy to more expansive communications about the future of their firm. With a lot of talk about defections, it remains to be seen whether these internal updates will be enough to keep people from abandoning ship -- or at least talking to the recruiters who are reportedly nosing around the firm.
Another factor in play: Those who are familiar with Securities America's activities confirm that the firm did due diligence on the now-toxic Medical Capital securities its advisors sold their clients -- who since lost an aggregate $400 million when the underlying debt failed.
"Of course they looked into these products, but nobody had any idea they were going to crash," says one consultant with a long-term relationship with the firm. "A lot of people did, but there's talk that Securities America is being punished as an example to everyone else who sold similar instruments."
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