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LPL Financial pulls pricing lever after Bill Hamm moves to yank $12 billion and 500 advisors off the IBD's line

The CEO of Independent Financial Partners will take 12 months move the asset trove to his own broker-dealer giving LPL time to woo reps looking for the door

Author By Lisa Shidler May 3, 2018 at 10:01 PM
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Bill Hamm: What LPL is doing is trying to level the playing field – which makes sense. I think we just decided there are things we wanted to do that are better done on our own.

Hybrid RIA

Jeff Spears

Jeff Spears

May 3, 2018 — 11:03 PM
LPL was the template that many breakaway platforms copied to recruit breakaway advisors. The next leg of LPL's growth will be determined by how well they use their scale to entice and retain advisors. Feels like they are doing the right things and legacy advisors are resisting the changes. Legacy advisors should take a step back and realize that change can be good.
Ron Edde  FA Recruiting & Mergers

Ron Edde FA Recruiting & Mergers

May 4, 2018 — 12:37 AM
One can surmise all one wants about whether LPL is going to add or lose advisors over the next few years, but the vast majority of the general public still has no idea what LPL even is. That's not a fatal issue, but it is nonetheless pretty surprising given the firm's scale.
William Hamm

William Hamm

May 4, 2018 — 6:54 PM
A point of clarification. Matthew Audette is correct, there are only $12b in assets at LPL. The balance are retirement plan assets along with assets held at outside custodians and third party managers. One other point to John Hylands comments, we have encouraged our advisors to seek out other alternatives and have given them 12 months to do it because we are confident in our program which includes new, portable third party, state of the art technology, significantly lower costs for the advisor and client, a purely advisor centric philosophy, ownership, enhanced product and platform choice, high degree of choice in how to service their clients along with total transparency. We fully expect attrition by advisors that are satisfied with the status quo or enticed by a big check but based on committals I've received, we are well over the majority of production that can transfer. In addition, we are getting significant interest from advisors and other firms outside LPL which we believe will more than offset any attrition created by others recruiting efforts. So I suppose we'll see in about 12 months. We wish everyone the best.
Brooke Southall

Brooke Southall

May 4, 2018 — 7:06 PM
Thanks for clarifying the assets, Bill. And, I like your game-on attitude!
William Hamm

William Hamm

May 7, 2018 — 5:39 PM
Thanks Brooke. One last point though, referencing John's statement of selling something that's not formed yet. That's not entirely true. 80% of our business is advisory through our RIA, which has been around for going on 20 years and has supported our advisors for that length of time. The broker dealer based portion is only 20% and declining, which is where we want it to be. So the change on the RIA business is just a custodial change for some of the business and not new at all. Our retirement plan business, third party money manager platforms, and outside custodians that we already use will not require any change at all, just a move for the assets custodied at LPL. The BD piece is basically an expansion of our OSJ duties that we've been handling for most of the last 18 years. The change is not as major as they might want to make it seem based on our research of the last couple of years. The main difference is that we will now have control over our own destiny unlike most hybrid arrangements in our industry today.

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Mentioned in this article:

LPL Financial
RIA-Friendly Broker-Dealer, RIA Welcoming Breakaways, Advisory Firm
Top Executive: Dan Arnold

Finetooth Consulting
Consulting Firm
Top Executive: Ryan Shanks

Diamond Consultants
Top Executive: Mindy Diamond

Private Advisor Group
Specialized Breakaway Service
Top Executive: Frank Smith, Chief Executive Officer

Independent Financial Partners
RIA Serving Other RIAs
Top Executive: William Hamm

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Consulting Firm, Specialized Breakaway Service, Recruiter
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