Why RIAs see Bernie Clark's appointment at Schwab as a positive event

Big clients of Schwab Advisor Services are giving the thumbs up to the appointment of Bernie Clark, 51, as head of the RIA custody business.

Some registered investment advisors say that Schwab Advisor Services’ former head of sales and relationship management has the knowledge, temperament and will to lead to take the business in the right direction.

Other RIAs are simply pleased that somebody in general is filling a position that was eliminated after Charles Goldman departed from it in November 2008. Jim McCool assumed oversight of the custody unit but he also oversaw corporate and retirement services, which meant he had a lot on his plate. Read: Jim McCool makes Bernie Clark the head of Schwab Advisor Services

“It’s such a big business that it seems like there should be someone who has it as their sole focus rather than splitting time and brain power with the corporate business,” says Tom Myers, principal with Brownson Rehmus & Foxworth, which oversees $10 billion of assets.

Knows our business

He adds: “Bernie seems like a guy who really knows our business.”

Clark has his own take on how his new role can be positive for RIAs.

“There’s a familiarity and a sense of knowing whose accountable,” he says. “Advisors just appreciate us understanding them and this [move] supports that understanding.”

Gregory Friedman, founder and president of Private Ocean, also has a favorable view of Clark.

“My basic reaction is that Bernie is a good person, and this should be a positive for us – advisors,” he says. “Schwab continues to do a great job in the day-to-day service which is critical to our success.”

Private Ocean is the new name for Salient Wealth Management and Friedman & Associates in the wake of their merger. The firm is based in San Rafael, Calif.

Jeff Roush, chief operating officer of Argos Wealth Advisors LLC of Napa, Calif., has a similar viewpoint.

“I think Bernie is a solid and thoughtful individual when it comes to listening and understanding RIA needs so I look forward to some positive progress with this organizational announcement,” he says.

Solid legacy

Though Clark’s arrival is a positive development, McCool leaves a solid legacy of leadership over Schwab Advisor Services, Myers says.

McCool was faced with the challenge of appeasing RIAs last Spring when Schwab decided it would no longer custody alternative assets.

McCool ultimately found ways to defuse the heated concerns of RIAs like himself, according to Myers.

“As much as the blame was going to fall on him, he would deserve credit for creating solutions,” he says. “They worked hard and found a way not to cause problems for us.”

One observer close to Schwab but who asked not to be named or characterized says that Clark’s appointment is a great development for Schwab.

Flow of initiatives

He believes that the flow of initiatives slowed during the time when Trish Cox, who oversaw service, and Bernie Clark, who oversaw sales, had to split authority.

Initiatives completed during the McCool-Cox-Clark period of leadership include the Make the Move program and the launch of the revamped website, Schwab Advisor Central.

The observer still wonders whether Schwab should have taken its restructuring one step further. Given that Schwab Advisor Services represents about 50% of the company’s profits, he believes that the head of the unit should report directly to Walt Bettinger, Schwab’s CEO.

Not hampered

Clark is not hampered by a lack of budget.

“We will be spending a great deal of money,” he says. “We really haven’t begun to satisfy all the demand that is coming our way” as a result of brokers leaving wirehouses to become RIAs.

Clark adds that he believes that Schwab is the only company that is positioned to truly capitalize on the enormous opportunity presented by these assets in motion.

“It’s very questionable who else [besides Schwab] could lead that considering what else is going on in the industry,” he says