Cetera Financial Group, the nation’s fifth-largest independent broker-dealer by revenue, said today it had agreed to buy Concourse Financial Group, the hybrid broker-dealer/RIA arm of Birmingham, Ala.-based insurance company Protective Life Corp.

The deal would bring 350 financial professionals into Cetera’s fold, along with $12 billion in assets under advisement and $4 billion in assets under management, according to a company statement released today.

Concourse was created by Protective Life in mid-2021 when the insurance company stitched together three of its affiliates: ProEquities, an independent RIA and broker-dealer; First Protective, a brokerage agency; and Protective Distributors, a life insurance distribution arm.

Protective Life said the deal is a streamlining move.

“This transaction allows Protective to focus on our core competencies in the life insurance and annuity businesses, while enabling Concourse Financial Group Securities financial professionals and clients to benefit from Cetera’s industry leading resources and support for today’s top advisors,” said Aaron Seurkamp, a senior vice president at Protective and president of its protection and retirement division, in the Cetera press release. “Cetera’s established success transitioning similar organizations to their platform gives us great confidence in this deal and underscores why Cetera is the right fit for this business.”

“Cetera’s community architecture and proven succession solutions are a natural fit for our business and we have a significant alignment of shared strategic objectives,” said Libet Anderson, the president of Concourse. “We look forward to a bright future together with Cetera.”

Cetera describes this as its latest insurance industry carve-out. It noted that in 2023 it had purchased the retail wealth business of Securian Financial Group, bringing in $50 million in client assets. In 2021, it bought Voya Financial Advisors’ independent planning channel. That deal, it said, added $37 billion in assets under administration. The 2019 purchase of Foresters Financial’s U.S. brokerage and investment advisory business brought in 500 advisors.

Cetera’s acquisition tear also included Avantax, the tax-focused broker-dealer it bought in late 2023.

Ratings agency Moody’s last year temporarily put Cetera’s parent company on a negative credit watch for its acquisition streak, but says now the company’s purchases have largely paid off. Yesterday, Moody’s affirmed the credit rating on the parent company, Aretec Group.

“The 2023 acquisitions of Avantax Inc. and certain assets related to Securian Financial Services Inc. have expanded the company’s advisor network and enhanced its client assets under administration by more than $130 billion to roughly $522 billion as of 30 June 2024,” Moody’s said. “Although Aretec reported a loss for the trailing 12 months ending 30 June 2024 due primarily to transaction-related expenses, the company's pretax earnings turned positive over the first half of the year, bolstered by the earnings contribution from the new businesses. The company has been able to reduce much of the corporate overhead associated with the new businesses, achieving substantial expense synergies that we anticipate will further improve its profitability.”

The acquired businesses helped the company’s debt-to-EBITDA ratio, Moody’s said.

There’s been a long trend of insurance companies like Protective Life getting out of the broker-dealer business, in part because of the pressure regulators have brought to bear on these companies selling proprietary products, especially annuities. Those pressures, specifically the onset of the Department of Labor’s various fiduciary rules, have made the sale of products like annuities more fraught with risk—such as the threat of fines and arbitration—that can erode insurance companies’ bottom lines. AIG’s former chief executive, Peter Hancock, said in 2016 that the upcoming Barack Obama-era fiduciary rule was one of the reasons it was offloading its broker-dealer business. Other companies have followed suit, especially MetLife, which sold off its retail advisor force to MassMutual.

Cetera, based in San Diego, was the fifth-largest independent broker-dealer by revenue in Financial Advisor’s latest survey. The company had 12,000 financial professionals and their teams under its purview as of June 30. It oversaw more than $521 billion in assets under administration and $224 billion in assets under management by that date, it said in its latest press release.