(Dow Jones) The giant wirehouses can no longer shrug off the growth in the ranks of independent brokers. ??The latest numbers show the industry shift becoming a significant threat, with more advisors leaving the large traditional brokerages to go independent than to go to other big shops.

In February, nearly 30% of the advisors who left Morgan Stanley Smith Barney, Bank of America Corp.'s Merrill Lynch, Wells Fargo Advisors and UBS Wealth Management Americas became independent advisors. Less than 25% went to one of the other three firms, according to research firm Discovery's registered representative movement report.

The trend of advisors turning independent has been increasing for several years, but it wasn't until last month that it surpassed wirehouse-to-wirehouse moves. ?

"It's always a threat to the wirehouses, but it's more like a chronic disease than a catastrophe," said Scott Smith, a brokerage analyst with Cerulli Associates.

By comparison, a year ago, in March 2009, only 11% of wirehouse advisors who moved went independent, compared to 62% who moved to another wirehouse, Discovery reported.

The big brokerages generally contend that lower-producing brokers are responsible for the attrition from their ranks. Bing Waldert, a brokerage analyst at Cerulli Associates, says there are grounds to that argument, as wirehouses are intentionally lowering payouts for those brokers, making them more attracted to independents. ?

"The wirehouses are still dominant. They haven't been knocked off their perch just yet," he said.

Cerulli Associates expects the independent channel to continue gaining 1 to 2 percentage points of the brokerage industry's market share each year but, Smith said, "It won't be the top 20% of wirehouse advisers moving, and that's all the wirehouses really need to stay on top." ?

Dennis Gallant, president of consulting firm GDC Research, also says he doesn't think the industry has hit a point "where brokers say they don't want to work for wirehouses." Many brokers don't want the headaches of running their own independent offices, and enjoy brand recognition and the full-service support provided by major firms.

Still, he says, the independent channel is no longer a "niche market that wirehouses can ignore." ?

Charles "Chip" Roame, managing principal of Tiburon Strategic Advisors, says "independent firms, especially registered investment advisors...have been catching up [to wirehouses] quicker than might be expected." ??Roame estimates that wirehouses manage about $5.5 trillion in client assets, compared with $2 trillion by independent firms.

Chet Helck, chief operating officer and head of Raymond James Financial Inc.'s private client group, said the growth in the firm's independent channel "is stronger than our employee channel's right now, which was not the case a couple years ago." He doesn't expect that momentum to be sustained, however, because of the wirehouses' ability to pay large signing bonuses. ?

Charles Huebner, a former UBS Wealth Management Americas broker, recently set up an independent shop, Pointe Capital Management, with several hundred million in assets custodied with Pershing LLC. In an interview late last month, he said there was a "certain heavy-handedness" to push propriety products at the wirehouses. Before going independent, his team was offered as much as 330% of the team's annual production to join another major firm, he said.

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