The Benefits of Advisor Teams

The Benefit of Advisor Teams: 1 + 1 = ? (2019)

More and more banks and credit unions are deploying some of their advisors in teams.  To help the industry understand this trend, LPL Financial Institutions commissioned Kehrer Bielan to survey the current state of advisor teams in financial institutions, how teams are structured, what motivates firms and advisors to form teams, and the impact of the teams on the business performance of advisors and their firms.

The Data

We drew on data from our three annual benchmarking surveys of bank-owned broker dealers, credit unions, and community and regional banks that partner with 3rd party BDs, which altogether encompass 333 institutions.

Of the 106 banks and credit unions that provided information in the section of the survey on advisor teams, 35% have one or more advisor teams.  The firms with advisor teams have 582 of their 1,689 advisors working in teams, coincidentally also 35%.  One fourth of those firms have less than 20% of their advisors participating in teams, while another quarter have more than 42% of their advisors deployed in teams. In one firm every advisor is part of a team.

 

The study describes the rich variety of advisor teams in banks and credit unions, including:

  • How are teams structured?
  • How is the team’s revenue allocated?
  • Why are teams created?

 

And the study examines the impact of teams on the firm’s business performance, including:

  • Revenue penetration
  • Advisor coverage
  • Profitability
  • Advisor production
  • Advisor and life insurance business
  • Planning adoption

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