Stifel Financial Corp.’s wealth management unit finished the year with record net revenues and pre-tax operating income, the company said Tuesday.
The retail business generated $474 million in net revenue during the fourth quarter, up 16 percent from a year ago, and for the full year the unit produced revenue of $1.8 billion, up 17 percent from 2016.
Client assets of $272.6 billion also set a new record, growing 15 percent from a year earlier.
Growth in bank-sweep balances and asset-management revenue drove results, CEO Ron Kruszewski told analysts on a conference call.
The firm continued to see a shift to fee-based assets, which hit a record $88 billion at year's end, up 25 percent for the year.
Advisor numbers were down slightly, by 1.6 percent, to 2,244 at year-end.
Stifel slowed its recruiting efforts in anticipation of the DOL rule, Kruszewski said, but the firm has “ramped that back up. I think that our recruiting pipeline is healthy.”
“Good markets tend to be a negative to recruiting, too,” he said. “People are very busy in good markets and that tends to have a dampening effect.”
Firms pulling out of the broker recruiting protocol will also impact industry recruiting and spark some increased litigation, he added.
“I personally am dismayed that the large firms have pulled out” of the protocol, Kruszewski told analysts. “I understand what they’re doing, but I think the industry will react because we can’t get in a situation where we’re limiting client choice. ... I think in the in the end the industry is going to deal with this.”
Stifel favors acquisitions over recruiting individual advisors, Kruszewski said.