Service and technology drive the custodian's success.

The mood at this year's TD Waterhouse Partnership 2004 National Conference, which took place February 4-7 at the Walt Disney World Dolphin Resort in Orlando, Fla., was almost festive. The market was rebounding, as TD Waterhouse's business was taking off.

Coming only a few weeks after its Toronto-based parent decided not to merge the brokerage with E*Trade, the conference was well attended and it was well received by the advisor community. Benjamin A. Tobias, CFP, CPA, CIMA, of Tobias Financial Advisors in Plantation, Fla., who has attended numerous TD Waterhouse events, declared this year's conference "without question their best conference ever."

At the opening session of the conference Frank J. Petrilli, president and chief executive officer of TD Waterhouse USA, painted an upbeat picture of the recent past and alluded to a bright future for both TD Waterhouse and the advisors it serves. In January 2004, customer assets held at TD Waterhouse were 40% higher than they were in January 2003.TD Waterhouse is now home to $125 billion in customer assets housed in 2.1 million accounts; 210,000 of those accounts and $9 billion of the assets represent new money.

The Advisor Service business is the fastest-growing segment of the company. In the year 2000, the advisor business accounted for just 4.3% of revenues and 11.5% of assets. At the end of 2003 advisors accounted for 9.3% of revenues and 21.9% of assets.

To further emphasize the importance of advisors to TD's future, Petrilli pointed out that in 2003 Merrill Lynch attracted $3.0 billion in net new assets. Of the $9.2 billion that TD Waterhouse USA attracted, Advisor Services was responsible for $6.4 billion. In other words, the roughly 2,600 advisors who do business with TD Waterhouse attracted more than double the net new assets that Merrill Lynch's much larger sales force was able to capture.

TD Waterhouse clearly believes that customer service and technology are driving their success in the Advisor Service sector. A recent study by Tiburon Strategic Advisors would appear to confirm this.

TD Waterhouse led the competition in the area of customer service and operations, garnering a score of 9.3 out of a possible 10. Fidelity ranked a close second, with a score of 9.0, while Schwab received a middling score of 7.3.

In the area of technology offerings and support, TD Waterhouse again led the pack with a score of 9.0. Fidelity ranked second in this area as well with an 8.5, while Schwab scored a respectable 8.0. (Readers can obtain a free copy of the study by completing a survey at Of course, the study contained a few inconsistencies. For instance, Schwab received the highest overall satisfaction rating while doing less well in individual areas.

According to Brian Stimpfl, first vice president at TD Waterhouse Institutional Services, the customer service scores did not come as a great surprise: "Advisors have always told us that this is TD Waterhouse's strength. We have always been customer focused, and we are glad to have it validated."

The technology scores, however, have Stimpfl "extremely excited." Initially, he says, "Technology was a big problem for us. We were playing catch up with Schwab." Stimpfl believes things really started turning around with the introduction three years ago of VEO, TD Waterhouse's Web-based platform for advisors, and continued to progress with the subsequent introduction of VEO Express and the establishment of partnerships with strong third-party providers.

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