LPL Financial has announced a significant acquisition, leading to an increase in its share price. The company is acquiring Atria Wealth Solutions, a wealth management company that provides support to around 2,400 advisors and 150 banks and credit unions. With approximately $100 billion in advisory assets and a larger number of advisors, Atria offers LPL expanded access to enterprise clients like banks and credit unions. The deal is expected to be finalized in the second half of 2024, pending regulatory approvals and meeting other conditions. It is predicted to positively impact LPL’s earnings.
Top Wealth Management News of the Week
Layoffs at Morgan Stanley
Morgan Stanley’s wealth management division is implementing cost-cutting measures that include laying off a few hundred employees. These cuts are primarily related to the integration of E*Trade and will not affect financial advisors or staff members directly involved with clients. The total impact will be less than 1% of the wealth unit’s workforce, which consists of approximately 40,000 staff members.
More Wall Street Texting Penalties
Late last week, the Securities and Exchange Commission (SEC) announced that 16 companies have agreed to pay a total of over $81 million in combined penalties. These penalties are related to charges involving their record-keeping practices and the use of text messaging apps by their employees. Among the companies, units of Northwestern Mutual will pay the largest penalty of $16.5 million. Guggenheim Securities will pay $15 million, while Oppenheimer & Co. agreed to pay $12 million. The Huntington Investment Company, who voluntarily reported issues, paid a smaller fine of $1.25 million.
Efforts to Raise SALT Cap Hit a Wall
Lawmakers from high-tax states on both sides of the aisle made attempts this week to advance legislation that seeks to roll back the provision set during the Trump administration. This provision capped the deduction for state and local taxes at $10,000. Unfortunately, a procedural measure that aimed to clear the way for a debate on the issue was defeated. Nevertheless, lawmakers are expected to continue their efforts to raise the cap for married couples.
Schwab’s Asset Growth Stalls
Charles Schwab experienced a mixed start to the new year. In January, they reported the largest monthly increase in new brokerage accounts in almost a year, with 366,000 new accounts. However, the net new assets for the month were only half of what they were a year ago. Schwab attributes this decline in part to the attrition of some TD Ameritrade clients. Fortunately, this attrition is now tapering off as most former Ameritrade customers have transitioned to Schwab’s platform.
Jan. 6 Defendant No Longer Employed at Ameriprise
Ameriprise, a leading financial advisory company, has parted ways with one of its advisors, Lee Giobbie, who is currently facing criminal charges for his alleged involvement in the Jan. 6, 2021, riot at the U.S. Capitol. While Ameriprise intended to terminate Giobbie’s employment, he chose to resign before any action was taken by the company. The termination was effective as of Feb. 14, as confirmed by the online database BrokerCheck.