LPL recruits Commonwealth advisors representing 80% of assets under management: executives
LPL Financial is still on track to retain 90% of Commonwealth Financial Network’s advisors, executives at the San Diego-based broker-dealer said Thursday.
LPL, which closed his purchase On Aug. 1, Commonwealth advisors signed commitments representing nearly 80 percent of the acquired company’s assets, executives said. They did not specify how many of the nearly 3,000 Commonwealth advisers had signed up
“We are excited about this transaction,” Richard Steinmeier, LPL’s chief executive, told analysts. “Its cultural alignment and complementary capabilities create a combined company that is far stronger than the sum of its parts.” We are confident of the value this will bring to Commonwealth advisors and existing LPL advisors and shareholders.
Steinmeier acknowledged that more persuasion would be needed among Commonwealth advisers to reach the 90 percent goal. The finish line is late 2026, when they and their clients are expected to be integrated into LPL’s brokerage and custody platform.
“Commonwealth’s advisors are really caring and a very diligent community, which really doesn’t surprise us, given the top advisors in the industry,” Steinmeier said.
This has involved thousands of interactions since LPL unveiled the deal six months ago, Steinmeier said. These are intended to ensure Commonwealth advisers “get the benefits of the mix”, he said.
The company began to feel confident enough in the retention efforts to consider bringing back “some of the recruitment and retention specialists that we had reserved and assigned to train the Commonwealth’s counselors,” Steinmeier said.
LPL placed a substantial bet on the deal, which Steinmeier said could also help it become more attractive to wiring consultants because of Commonwealth’s high-end brand and culture.
“Making the Commonwealth successful is job number one right now,” Steinmeier said.
During the quarter, LPL increased its total advisory and brokerage assets by 45% year-over-year to $2.3 trillion, with advisory assets increasing 51% to $1.3 trillion, driven primarily by its acquisition of the Commonwealth.
The Commonwealth purchase generated $275 billion in new net assets acquired, the lion’s share of the San Diego-based company’s total net assets of $308 billion, the company said.
LPL’s roster of 32,100 advisors is the largest in the wealth management industry. It includes approximately 18,400 independent contractors as well as another 13,700 people working for RIAs and other institutions. These included Commonwealth advisers, who numbered around 2,900 at the time the agreement was concluded.
LPL also said $6 billion in assets had been removed from the market as part of the previously planned separation of the large, misaligned Office of Supervisory Jurisdictions.
Steinmeier said recruiting remains “artificially” lower in the industry, but pay changes among operators have prompted more brokers to “raise their heads to consider an alternative.”
