(Dow Jones) UBS AG's Wealth Management Americas head Robert McCann is offering some financial advisors an incentive to stay with the Swiss bank's U.S. brokerage.

The program, called Growth Plus, is essentially a retention package. The plan will reward brokers who have been with the firm for more than five years and generate at least $500,000 in annual production starting next year, according to people familiar with the plan.

These advisors will be paid on a sliding scale, up to 65% of their production next year and in ensuing years. It couldn't be determined how many years were involved. Brokers will receive part of the payout in December 2010 in the form of a seven-year forgivable loan that will expire in 2018. If brokers leave the firm before the end of that time period, they would have to pay back the remainder of the balance to UBS.

A UBS spokesman said the program, "is an enhancement to our existing financial advisor compensation plan that is designed to allow financial advisors to participate and share in the future of our firm."

News of the plan was reported earlier Thursday by The Financial Times.

McCann announced the plan at a meeting in New York with the firm's top 300 advisors, also known as The Chairman's Club. A person familiar with the plan estimated that just over 20% of UBS' 7,200 advisors would qualify for the payout.

The incentive is unusual because retention packages are typically only offered to advisors after their firm is acquired by or merges with another competitor. While UBS hasn't been involved in any such deals, the firm has lost hundreds of advisors and experienced client asset outflows over the past year. The payout could be one measure to stop these losses.

Brokers at Morgan Stanley Smith Barney, Merrill Lynch and Wells Fargo are tied down to their firms by retention packages or other deferred compensation programs. All three firms were involved in either an acquisition or a joint venture. Until now, UBS didn't offer such an incentive to brokers, which put the firm at a competitive disadvantage in terms of recruiting.


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