Prudential Securities and Morgan Stanley Dean Witter are reorganizing their retail divisions. Prudential is making the change to cut costs while MSDW says the changes are part of an expansion plan.
In January, Prudential consolidated its 16 retail sales regions into 12 larger ones in order to streamline retail operations and enhance profitability, according to a spokesperson. The firms New Jersey territory was merged with the Connecticut and Long Island areas to create a tri-state territory. The San Diego region was folded into the Los Angeles sales region, and Chicago was absorbed into the Midwest territory. Branch level changes have also occurred, including consolidating the supervision of Prudentials two Washington, D.C., locations with one manager, Forrest Williams.
The firm says the reorganization will have little or no impact on retail brokers. However, a Chicago-area producer disagrees, telling Registered Representative that management shuffles always result in mild disruptions.
Over time, you can develop some worthwhile relationships with a manager who moves away because of a reorganization or structural changes, and that can be disappointing, the broker says. Its probably not a major consideration for management during these reorganizations, but at the producer level, those relationships can make or break a lot of producers.
Prudential also renamed its retail division. The former Consumer Markets Group is now called the Private Client Group to better reflect our purpose, which is to establish long-term relationships with affluent households, says spokesperson Susan Atran.
Meanwhile, MSDW is expanding its retail management organization. According to one branch manager at the firm, the company is reorganizing seven regions into three, with four divisions in each of the three new regions.
Were not sure what to make of it, says the branch manager, who suspects the firm wants tighter control over what the branches are doing and selling.
One top producer at the firm has a different take: My impression is that firms are hiring more and more managers because of liability issues, the rep says.
MSDW spokesperson Timothy Lee declined to comment on the reorganization and retail chief Robert Dwyer did not return calls.
On Dec. 1, the firm also renamed Morgan Stanleys old Private Client Services division, a unit that serves high-net-worth individuals. It was renamed the Private Wealth Management (PWM) Group. In February, an Atlanta office was opened to oversee PWM activities in the Southeast. PWM has 13 offices worldwide, including six in the United States.