The number of registered investment advisory (RIAs) firms merging last year dipped, according to a new report from Schwab Advisor Services.
The report released by Schwab today showed that there were 57 M&A deals involving RIAs in 2011, down 19 percent from 70 deals in 2010. The amount of assets under management and the average size of each deal were down as well. AUM dropped 30 percent from $63 billion in 2010 to $44 billion last year, while the average deal size dropped 11 percent, from $895 million to $798 million, the lowest average since 2005.
Of the 57 deals tracked by Schwab in 2011, 58 percent of deals represented less than $500 million in assets under management, 33 percent of deals were between $500 million and $2 billion, and 9 percent of deals were greater than $2 billion.
Schwab began tracking M&A transactions in 2004.
"Market volatility and economic uncertainty led to a decline in M&A activity in the second half of the year," said Nick Georgis, vice president of Schwab Advisor Services. "RIAs remain the dominant buyer category, but we observed a measurable increase in the number of transactions completed by banks."
Schwab Advisor Services provides custodial, operational and trading support for more than 6,000 independent RIAs.