Are You Adding Financial Advisors?

At the fall meeting of the Kehrer Bielan Leadership Study Group in Chapel Hill, Tim Kehrer reiterated the case for increasing financial advisor headcount.  “Again and again we find that adding financial advisors is the most promising runway to increasing investment services revenue,” he commented.

Tim shared data from the 2020 Kehrer Bielan benchmarking survey, demonstrating that investment services revenue increases exponentially as firms add advisors.

Reading the chart from left to right, we see the impact of decreasing the amount of branch deposit territory entrusted to a financial advisor in a firm in a bank or credit union.  Expressing revenue relative to an institution’s deposits levels the playing field among financial institutions of different sizes, allowing us to compare their revenue from investment services.

“Adding a financial advisor naturally adds that financial advisor’s revenue to the firm,” Tim added. “But the data show that revenue grows more than incrementally.  Thicker financial advisor coverage of the deposits enables the firm to deploy strategies that make its financial advisors more productive, by reducing the size of their client book, deploying them in teams, or shifting them out of the branches to focus on deepening client relationships.”

Dave Bresler, Vice President of the Advisor Business Development Group at Ameriprise Financial concurs with the findings in the survey.  “As firms grow the number of financial advisors serving clients, there is sometimes fear that adding more people will dilute production per financial advisor. In reality, adding financial advisors is truly additive, even if they are new to serving clients. When you free up capacity to see your clients more frequently and serve them more comprehensively, only good things can happen!”

To learn more about how Ameriprise Financial Institutions Group helps institutions build their investment program with qualified recruiting, strategic analysis and meaningful financial advisor support, please contact 800.679.1237 or go to ameriprise.com/AFIG.

Ameriprise Financial and Kehrer Bielan are not affiliated.

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