regional bank vs. wire house

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bjack73's picture
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i am curious to know the general consensus on people's feelings regarding going to work as a FA at one of the big wire houses or working as an investment consultant for a small regional bank.
I started out in the bank channel and am looking to get into one of the wirehouses because of more independence (meaning no bank staff egos to stroke everyday); higher payouts, no "hair-cuts"; a better opportunity to make 6-figures.
I have a friend looking to get into the business and also wants to look at the wirehouse side. The trainee programs in the wirehouse are much better (in my opinion) than he would ever get on the bank side.
Do you guys/gals feel the same or do most feel like the bank is a better place to work because at least you have an easier chance to see clients through the bank staff giving referrals?

cranky sob's picture
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ONe sucks, the other one sucks more.

maybeeeeeeee's picture
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holy moly you are cranky
do you think you would be able to take customers with you if you left the bank?
 

bjack73's picture
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Joined: 2006-04-23

i already left the bank...i signed a non-compete clause but i can start calling on them in about 5 mos or so..

lawsucks's picture
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bjack73 wrote:
I have a friend looking to get into the business and also wants to look at the wirehouse side. The trainee programs in the wirehouse are much better (in my opinion) than he would ever get on the bank side.
Do you guys/gals feel the same or do most feel like the bank is a better place to work because at least you have an easier chance to see clients through the bank staff giving referrals?

I would agree that the training at a wirehouse is better, but your friend will have a lot better chance of actually surviving the first 3 years if he goes to a bank.  Personally, if I had the chance to do it over again, I would start at a bank - consistent referrals and they will, usually, pay for CFP study.
How old is your friend, how much sales experince does he have, and what kind of network has he already established in his former career?
Depending on your answer to these three questions, my recommendation might be different.

bjack73's picture
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my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.

NASD Newbie's picture
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bjack73 wrote:my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.
Ah, the perfect candidate.
A harsh reality, boys and girls, is that this is a sales business and in order to succeed you have to be a salesperson first and foremost.
However, you must also never lose sight of the fact that you also have competition--lots and lots of it.
There are very few, like almost no, potential clients who do not have a friend or family member who is a financial advisor.
Having a network is critical to success.  If you cannot sit down with a yellow pad and damn near fill it up with the names of people who you think might--just might--do business with you if you get registered you really ought to give the entire experiment a second thought.
What seems to have happened is--due to the fact that individuals are now in charge of their own retirements--the job title known as financial advisor has become more noticable than it was twenty or so years ago.
As a result it's showing up things like "Top paying jobs" lists and young people coming out of school are deciding that that is what they want to be when they grow up.
Well, it's not that easy.  Without fabulous selling skills and a huge network of possible clients you'd do better spending your time on a practice tee hoping to be able to qualify for the tour.
Those of you who are whining about making cold calls for hour after hour--consider it the equivalent of spending days, weeks, months hitting buckets of balls.

BankFC's picture
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bjack73 wrote:
i am curious to know the general consensus on people's feelings regarding going to work as a FA at one of the big wire houses or working as an investment consultant for a small regional bank.
I started out in the bank channel and am looking to get into one of the wirehouses because of more independence (meaning no bank staff egos to stroke everyday); higher payouts, no "hair-cuts"; a better opportunity to make 6-figures.
You won't have to stroke, but...don't think their aren't haircuts.  Once you are on grid, the same annuity that pays me 7% here at the bank upfront paid me 4.5% at ML.  Payout isn't going to be that high until your a BIG producer (count on around 40%).
As far as a "better opportunity to make 6-figures" I don't know any quicker way (I've done both) to gather assets than to call them as a bank broker.  If you really think as a trainee it'll be faster doing cold calling/seminars/networking/whatever else, then good luck...you'll need it.
I have a friend looking to get into the business and also wants to look at the wirehouse side. The trainee programs in the wirehouse are much better (in my opinion) than he would ever get on the bank side.
This IS true.  Banks don't train brokers in my experience, they just recruit from the wires (that's how I got here ).  If he needs training, go to ML/UBS/SB...salary, good training, etc while you learn and build.
Do you guys/gals feel the same or do most feel like the bank is a better place to work because at least you have an easier chance to see clients through the bank staff giving referrals?
IMO yes IF you know what your doing!  Again, no training, so unless you have some background, don't go to a bank.  Unlike a wirehouse, at a bank it only takes one or two foul ups with clients, and the whole bank hears about it...I saw it happen in another region firsthand. 
Regardless...good luck!

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BankFC wrote:
I have a friend looking to get into the business and also wants to look at the wirehouse side. The trainee programs in the wirehouse are much better (in my opinion) than he would ever get on the bank side.
This IS true.  Banks don't train brokers in my experience, they just recruit from the wires (that's how I got here ).  If he needs training, go to ML/UBS/SB...salary, good training, etc while you learn and build.

There is another side to that coin.
Most wirehouse managers look upon banks as:
1.  A place where the guys they want to fire seem to end up.  It is not uncommon for a manager who actually likes somebody who is going to fail to make a call to a bank and recommend that they hire somebody who he is going to have to fire for lack of results and potential.
2.  Not a place to find high quality talent.  Read what the bank types say and you'll hear phrases like "no prospecting," "ready source of leads," "lists of maturing CD's" and so forth.  These are all good reasons to work for a bank if you're not well connected and/or not a good salesperson.
However, you're never going to have a complete arsenal unless you work for a major wirehouse.
Everybody else, to one degree or another, finds themselves attempting to convince the client that they want what can be obtained instead of obtaining what is wanted.
If you want a new tie is it better to walk into a store with hundreds of selections, or one with dozens of selections?
Here's a good rule of thumb.  There will be an exception or two, but they're rarer than hen's teeth.
A bank broker who used to be a wirehouse broker was failing as a wirehouse broker so they sent themselves down to the minor leagues.
I know, I know, Roger Clemens was pitching in the minor leagues--maybe still is.  As I said there are always exceptions to rules.

maybeeeeeeee's picture
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Bank FC--I enjoy reading your posts and they contain good information. 
So, what do you do when you need answers?  Is there any type of back office support?  Where do you get research?  Do they provide you with Morningstar or S&P, etc?  To be doing all of the research yourself AND taking care of clients would be very time consuming.
Here we have excellent research and support covering everything from Options, Stocks, Bonds, Preferred, IPO, Annuities, Insurance--you name it.
That allows me to be a team leader and focus more of my efforts of bringing these back office expert ideas to the client.
Your feedback would be welcome, Bank FC

BankFC's picture
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NASD Newbie wrote:BankFC wrote:
I have a friend looking to get into the business and also wants to look at the wirehouse side. The trainee programs in the wirehouse are much better (in my opinion) than he would ever get on the bank side.
This IS true.  Banks don't train brokers in my experience, they just recruit from the wires (that's how I got here ).  If he needs training, go to ML/UBS/SB...salary, good training, etc while you learn and build.

There is another side to that coin.
Most wirehouse managers look upon banks as:
1.  A place where the guys they want to fire seem to end up.  It is not uncommon for a manager who actually likes somebody who is going to fail to make a call to a bank and recommend that they hire somebody who he is going to have to fire for lack of results and potential.
NASD, I want what you are smoking if you think the branch manager at a wirehouse has the time or the general inclination to be concerned about where a failing broker is going, whether he likes him or not...not saying this hasn't EVER happened, but it is not common at all.
2.  Not a place to find high quality talent.  Read what the bank types say and you'll hear phrases like "no prospecting," "ready source of leads," "lists of maturing CD's" and so forth.  These are all good reasons to work for a bank if you're not well connected and/or not a good salesperson.
NASD gives a sliver of truth here, but still marred in arrogance.  At a wire as a young rookie, the only way to make it is either you are well connected OR YOU JOIN A TEAM (which gives you leads, involves less prospecting as you are given C clients, etc etc). 
Simply being a good salesman IS NOT ENOUGH.  Just having the ability to close is not enough, you have to get in front of enough people DAY IN AND DAY OUT to make it, and that is the difficult part.
However, you're never going to have a complete arsenal unless you work for a major wirehouse.
LOL, you're right.  You won't have the structured notes that go long the yen and the rubel, and short the australian dollar.  TRY SELLING THAT to 99% of the population.
Everything else, you will have, such as: mutual funds in and out of wrap accounts, fee based brokerage, cash management accounts JUST LIKE ML's CMA, SMA's, individual equities and debt, financial planning software, etc etc the list goes on and on...
Everybody else, to one degree or another, finds themselves attempting to convince the client that they want what can be obtained instead of obtaining what is wanted.
This is just a negative statement.  No rebuttal required.
If you want a new tie is it better to walk into a store with hundreds of selections, or one with dozens of selections?
Financial products have become a COMMODITY.  EVERYONE has the same or similar products as everyone else.  If anyone has an interest in keeping this a secret, it would be the wirehouses.  Because, as it used to be, you could only get what they sold from THEM.  Hardly that way anymore, and anyone that says any different is LYING.  EVEN the State Farm guy can sell mutual funds. 
It's all about the relationship now, and who has a better open door to a prospect, a cold calling wirehouse broker, or a bank broker introduced to the prospect by the loan officer he has worked with for ten years?
Here's a good rule of thumb.  There will be an exception or two, but they're rarer than hen's teeth.
A bank broker who used to be a wirehouse broker was failing as a wirehouse broker so they sent themselves down to the minor leagues.
That's just incorrect.  Some do I'm sure.  Just like one of the guys I worked with at ML who was previously at 2 other firms, of which he was fired from both.  Wires have recruiting goals, and if you have your licenses, can bs enough, it's not hard to get hired.
In my program specifically, 40% or so of us have CFP's,  and all of us except two were recruited from wires and/or major insurance companies (the like of JH, NYL, NWM, etc).
So to all you uninformed folks out there, don't let NASD lead you astray...he's just old and grumpy.
 
I know, I know, Roger Clemens was pitching in the minor leagues--maybe still is.  As I said there are always exceptions to rules.

troll's picture
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NASD Newbie wrote:
bjack73 wrote:my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.
Ah, the perfect candidate.
A harsh reality, boys and girls, is that this is a sales business and in order to succeed you have to be a salesperson first and foremost.
However, you must also never lose sight of the fact that you also have competition--lots and lots of it.
There are very few, like almost no, potential clients who do not have a friend or family member who is a financial advisor.
Having a network is critical to success.  If you cannot sit down with a yellow pad and damn near fill it up with the names of people who you think might--just might--do business with you if you get registered you really ought to give the entire experiment a second thought.
What seems to have happened is--due to the fact that individuals are now in charge of their own retirements--the job title known as financial advisor has become more noticable than it was twenty or so years ago.
As a result it's showing up things like "Top paying jobs" lists and young people coming out of school are deciding that that is what they want to be when they grow up.
Well, it's not that easy.  Without fabulous selling skills and a huge network of possible clients you'd do better spending your time on a practice tee hoping to be able to qualify for the tour.
Those of you who are whining about making cold calls for hour after hour--consider it the equivalent of spending days, weeks, months hitting buckets of balls.

 
He's old, he's grump and he's generally just a PITA, but on this one, he's 100% right.

BankFC's picture
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maybeeeeeeee wrote:
Bank FC--I enjoy reading your posts and they contain good information. 
Thanks! 
So, what do you do when you need answers?  Is there any type of back office support?  Where do you get research?  Do they provide you with Morningstar or S&P, etc?  To be doing all of the research yourself AND taking care of clients would be very time consuming.
Yes, actually our B/D does an good job of providing back office support and compliance, as well as providing me with client situation specific information. 
They offer us insurance specialists (I have a pretty strong ins background myself), wealth management specialists, and trust specialists if we need it. 
I have access and use frequently Morningstar Advisor Workstation, and I was using Value Line, but I dropped it for a number of reasons.
I sell managed money solutions almost exclusively, so what few stock trades I place are unsolicited.  But this wasn't any different when I was at ML.
Here we have excellent research and support covering everything from Options, Stocks, Bonds, Preferred, IPO, Annuities, Insurance--you name it.
I can sell all of those as well, with the exception of equity IPO's, unless I'm just not aware of it.  Like I said, I don't look for individual stock business much.  We can do options, margin, annuities, lots of different life disability and LTC insurance (Mass Mutual, JH, Pru, NYL, Met, etc).
Our bond desk is really good IMO.  They email out issues that look attractive, and can get some really stellar new issues, especially on the agencies.
That allows me to be a team leader and focus more of my efforts of bringing these back office expert ideas to the client.
From my experience, the difference is minimal.  Again, the major difference is the individual equity research.  At ML, we had Bob Doll, MLIM, Morningstar, Jaywalk, S&P, and a couple others...but even though it was nice to have, I don't do that business.  I sell SMA's, mutual funds, insurance and annuities (on the individual side).  The only individual business I do is in fixed income.
As far as anything else...401K's I use Hartford and a great TPA here in town.  That's about it. 
Your feedback would be welcome, Bank FC

troll's picture
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NASD Newbie wrote:
bjack73 wrote:my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.
Ah, the perfect candidate.
A harsh reality, boys and girls, is that this is a sales business and in order to succeed you have to be a salesperson first and foremost.
However, you must also never lose sight of the fact that you also have competition--lots and lots of it.
There are very few, like almost no, potential clients who do not have a friend or family member who is a financial advisor.
Having a network is critical to success.  If you cannot sit down with a yellow pad and damn near fill it up with the names of people who you think might--just might--do business with you if you get registered you really ought to give the entire experiment a second thought.
What seems to have happened is--due to the fact that individuals are now in charge of their own retirements--the job title known as financial advisor has become more noticable than it was twenty or so years ago.
As a result it's showing up things like "Top paying jobs" lists and young people coming out of school are deciding that that is what they want to be when they grow up.
Well, it's not that easy.  Without fabulous selling skills and a huge network of possible clients you'd do better spending your time on a practice tee hoping to be able to qualify for the tour.
Those of you who are whining about making cold calls for hour after hour--consider it the equivalent of spending days, weeks, months hitting buckets of balls.
....and you were chastising me for investing in that club membership....

BankFC's picture
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mikebutler222 wrote:NASD Newbie wrote:
bjack73 wrote:my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.
Ah, the perfect candidate.
A harsh reality, boys and girls, is that this is a sales business and in order to succeed you have to be a salesperson first and foremost.
However, you must also never lose sight of the fact that you also have competition--lots and lots of it.
There are very few, like almost no, potential clients who do not have a friend or family member who is a financial advisor.
Having a network is critical to success.  If you cannot sit down with a yellow pad and damn near fill it up with the names of people who you think might--just might--do business with you if you get registered you really ought to give the entire experiment a second thought.
What seems to have happened is--due to the fact that individuals are now in charge of their own retirements--the job title known as financial advisor has become more noticable than it was twenty or so years ago.
As a result it's showing up things like "Top paying jobs" lists and young people coming out of school are deciding that that is what they want to be when they grow up.
Well, it's not that easy.  Without fabulous selling skills and a huge network of possible clients you'd do better spending your time on a practice tee hoping to be able to qualify for the tour.
Those of you who are whining about making cold calls for hour after hour--consider it the equivalent of spending days, weeks, months hitting buckets of balls.

 
He's old, he's grump and he's generally just a PITA, but on this one, he's 100% right.

No disagreement here.  But generally, he is a PITA...by the way, what's a PITA? 

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mikebutler222 wrote:
He's old, he's grump and he's generally just a PITA, but on this one, he's 100% right.

It is not possible to acquire 35 years of experience without being older than a 27 year old.
In an earlier comment I said that by working at a wirehouse you will have a full arsenal, so that you can otain what the client needs rather than having to settle for a selection from what is available to you.
That was dismissed as a "negative statement."
It is not negative, it's factual and those who work for banks envy those who work for the wirehouses and those who work for the premier insurance companies.
The reality is that banks, S&Ls, credit unions and the like have joined the competition reluctantly, late, and halfheartedly.
If you were the CEO of a bank high on your list of goals is to grow the bank's deposits.  If you can get Mrs. Jones to buy a $50,000 CD you can lend her money to somebody and earn interest on the spread between what you pay Mrs. Jones and what the borrow pays the bank.  In a nutshell that's what bankinig is all about.
Now, why in the world would you want the bank to make an effort to get Mrs. Jones to buy $50,000 worth of something else instead of a CD?
The Mutual Fund industry has studies that seem to suggest that by offering brokerage services the bank actually attracts new money from the client. Essentially what they're saying is that Mrs. Jones buys the CD and also buys a mutual fund.
That, of course, does not make sense--but what MIGHT happen is that Mrs. Jones allows the bank to become the servicing broker for a mutual fund.  Or perhaps Mrs. Jones will buy an annuity from the bank because she doesn't have a strong relationship with a life insurance guy.
There are a lot of scenarios that can develop but the reality is that senior management in banks do not consider their efforts to compete with Merrill to be well founded--and therefore will not well fund them.
When they first started to compete--about fifteen years ago--they made the strategic mistake of promoting from within.  Move a guy who was a good commercial lender over to the broker/dealer--send a teller or two to a Series 6 cram course and get them licensed to sell funds and annuities.
It never occured to them that Wall Street is a selling game, and a good commercial lending officer or teller is not necessarily a good salesperson--if they were they would be a salesperson instead of a lending officer or teller.
Industry organizations such as the Securities Industry Association and the NASD organized groups of senior officers from the bank broker dealers and over the course of several years convinced them that they were never going to break out if they didn't hire salespeople.
So, the banks began to recruit from places like Merrill.  Enter another reality.  Banks don't really pay all that well, and a star finanical advisor makes a lot more money than almost everybody who works at a bank.
So here is a recruiting vice president from a bank--earning $75,000 a year trying to recruit from brokerage houses.
If you're earning $350,000 at Merrill are you going to be impressed by a guy wearing cheap clothes offering you the opportunity to sit at a child-like desk next to the receptionist at a bank branch?
Of course not.  But the banks had been convinced that they needed sales people and that brokerage sales experience is the most desireable type of experience.
So they, the banks, lowered their sights and decided to start recruiting brokers from Merrill who were about to wash out.  I am aware of bank B/D officers who actually had dinner with the local wirehouse managers and told them that they, the bank, would be happy to hire brokers who were little more than dead wood at the wirehouse.
This allowed the wirehouse managers a bit of flexibility.  That broker out there in the office who is actually little more than a breakeven situation could be nudged out the door in the direction of the bank.
Oh sure, they might take a few accounts with them, but they're not making it here so how much damage can they do if they pulled all of their accounts with them?
The bottom line is that banks are still trying to find their "sea legs."  A guy can make a career out of a bank, but a woman will find them to be more friendly.  In most of the senior officers are women and they are exceptionally women friendly environments.
It is true that they don't have to do a lot of prospecting--tellers will "bird dog" for them
"Mrs. Johnson, since you're cashing dividend checks it means that you are an investor.  Have you met Mrs. Jones our investment professional?
No?  Well, she's in our branch every Wednesday.  Could I arrange a meeting for you?"
They'll often give it a bit of a nudge such as, "We're having a contest for two tickets to the symphony and if you'll just meet with her I'll have a better chance of winning."  Who can turn that down?
Now, remember that I"m old so I couldn't possibly know what I'm talking about as well as somebody who has been in the business since way back before Christmas.
 

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NASD hits it right on the head with regard to sales ability being the most important trait for trainees. Lack of sales ability and refusal to accept the reailty of the sales aspect of the biz are two big reasons for the high failure rate among trainees. This is why I advise young college grads to get some sales experience first. First to find out if they can sell and secondly to find out if they like it. Dragging a bag behind you selling copy machines for a few years is an excellent training program for this biz. As would be selling just about anything else.
One of the most successful brokers I know of sold cars as a way to get experience. When he tried to get into the biz he was rejected by firm after firm because he lacked sales experience. One manager told him to get a sales job, any sales job, and to mail him his production reports. The trainee candidate then tried to get hired on as a sales person with several firms and couldn't because of his lack of sales experience. Finally, after being rejected by the local Ford dealership he pleaded with the manager to hire him. Imagine this, this guy is in his thirties, and has a masters degree, could get a job in his technical field in a heart beat, and is practically begging to get hired. He made a deal with the manager that he wouldn't take anything from the existing sales people and would develope his own leads. The manager hired him. To develope leads he cold walked the streets near the dealership. Within six months he was the dealership's top producing sales person. As agreed, he kept sending his monthly sales production reports to the wirehouse mgr. It took about a year for the wirehouse to hire him. He went on to become a two million dollar producer. He's an extraordinary person but still, this is what it takes to succeed.

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joedabrkr wrote:....and you were chastising me for investing in that club membership....
That was "Big Easy Flood" but I agree with him, I don't believe you're such a failed planner that you'd actually do that for a couple of years.

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mikebutler222 wrote:NASD Newbie wrote:
bjack73 wrote:my friend does not have sales exp. He is a CPA and is 36 yrs old. He does not have a network of people to give him referrals.
Ah, the perfect candidate.
A harsh reality, boys and girls, is that this is a sales business and in order to succeed you have to be a salesperson first and foremost.
However, you must also never lose sight of the fact that you also have competition--lots and lots of it.
There are very few, like almost no, potential clients who do not have a friend or family member who is a financial advisor.
Having a network is critical to success.  If you cannot sit down with a yellow pad and damn near fill it up with the names of people who you think might--just might--do business with you if you get registered you really ought to give the entire experiment a second thought.
What seems to have happened is--due to the fact that individuals are now in charge of their own retirements--the job title known as financial advisor has become more noticable than it was twenty or so years ago.
As a result it's showing up things like "Top paying jobs" lists and young people coming out of school are deciding that that is what they want to be when they grow up.
Well, it's not that easy.  Without fabulous selling skills and a huge network of possible clients you'd do better spending your time on a practice tee hoping to be able to qualify for the tour.
Those of you who are whining about making cold calls for hour after hour--consider it the equivalent of spending days, weeks, months hitting buckets of balls.

 
He's old, he's grump and he's generally just a PITA, but on this one, he's 100% right.

No he is an idiot.  I like you Mike, but I cannot believe you read his posts.  As soon as I see his sign on, I hit the down key.  I do not read his posts OR RESPOND TO THEM. 

maybeeeeeeee's picture
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tjc45 wrote:
NASD hits it right on the head with regard to sales ability being the most important trait for trainees. Lack of sales ability and refusal to accept the reailty of the sales aspect of the biz are two big reasons for the high failure rate among trainees. This is why I advise young college grads to get some sales experience first. First to find out if they can sell and secondly to find out if they like it. Dragging a bag behind you selling copy machines for a few years is an excellent training program for this biz. As would be selling just about anything else.
One of the most successful brokers I know of sold cars as a way to get experience. When he tried to get into the biz he was rejected by firm after firm because he lacked sales experience. One manager told him to get a sales job, any sales job, and to mail him his production reports. The trainee candidate then tried to get hired on as a sales person with several firms and couldn't because of his lack of sales experience. Finally, after being rejected by the local Ford dealership he pleaded with the manager to hire him. Imagine this, this guy is in his thirties, and has a masters degree, could get a job in his technical field in a heart beat, and is practically begging to get hired. He made a deal with the manager that he wouldn't take anything from the existing sales people and would develope his own leads. The manager hired him. To develope leads he cold walked the streets near the dealership. Within six months he was the dealership's top producing sales person. As agreed, he kept sending his monthly sales production reports to the wirehouse mgr. It took about a year for the wirehouse to hire him. He went on to become a two million dollar producer. He's an extraordinary person but still, this is what it takes to succeed.

YOU ARE PROBABLY JUST NASD, PUT, BIG EASY UNDER ANOTHER NAME.  Most of us here do NOT READ posts from those idiots nor respond to them.

BankFC's picture
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NASD Newbie wrote:mikebutler222 wrote:
He's old, he's grump and he's generally just a PITA, but on this one, he's 100% right.

It is not possible to acquire 35 years of experience without being older than a 27 year old.
In an earlier comment I said that by working at a wirehouse you will have a full arsenal, so that you can otain what the client needs rather than having to settle for a selection from what is available to you.
That was dismissed as a "negative statement."
It is not negative, it's factual and those who work for banks envy those who work for the wirehouses and those who work for the premier insurance companies.
NASD, I would like to extend the opportunity for you to PROVE me wrong.  Please give SPECIFIC examples of what "arsenal" weapons (products) wirehouses have that bank B/D don't have. 
If you were the CEO of a bank high on your list of goals is to grow the bank's deposits.  If you can get Mrs. Jones to buy a $50,000 CD you can lend her money to somebody and earn interest on the spread between what you pay Mrs. Jones and what the borrow pays the bank.  In a nutshell that's what bankinig is all about.
Now, why in the world would you want the bank to make an effort to get Mrs. Jones to buy $50,000 worth of something else instead of a CD?
How little you know...it's called non-interest income and it is a BIG DEAL in banks.
The Mutual Fund industry has studies that seem to suggest that by offering brokerage services the bank actually attracts new money from the client. Essentially what they're saying is that Mrs. Jones buys the CD and also buys a mutual fund.
That, of course, does not make sense--but what MIGHT happen is that Mrs. Jones allows the bank to become the servicing broker for a mutual fund.  Or perhaps Mrs. Jones will buy an annuity from the bank because she doesn't have a strong relationship with a life insurance guy.
There are a lot of scenarios that can develop but the reality is that senior management in banks do not consider their efforts to compete with Merrill to be well founded--and therefore will not well fund them.
That is a straight out lie.  I am provided with a cell phone, laptop, expense account for ANY business related expense (including seminars), mileage reimbursement, ins premium COMPLETELY paid by bank, 6% Non-Matching contribution by bank into 410K, and whatever marketing materials I need are provided.
NONE OF THAT WAS PROVIDED AT MERRILL LYNCH.
When they first started to compete--about fifteen years ago--they made the strategic mistake of promoting from within.  Move a guy who was a good commercial lender over to the broker/dealer--send a teller or two to a Series 6 cram course and get them licensed to sell funds and annuities.
It never occured to them that Wall Street is a selling game, and a good commercial lending officer or teller is not necessarily a good salesperson--if they were they would be a salesperson instead of a lending officer or teller.
Industry organizations such as the Securities Industry Association and the NASD organized groups of senior officers from the bank broker dealers and over the course of several years convinced them that they were never going to break out if they didn't hire salespeople.
So, the banks began to recruit from places like Merrill.  Enter another reality.  Banks don't really pay all that well, and a star finanical advisor makes a lot more money than almost everybody who works at a bank.
So here is a recruiting vice president from a bank--earning $75,000 a year trying to recruit from brokerage houses.
If you're earning $350,000 at Merrill are you going to be impressed by a guy wearing cheap clothes offering you the opportunity to sit at a child-like desk next to the receptionist at a bank branch?
No child-like desk.  Office is next to commercial lending dept. 
Of course not.  But the banks had been convinced that they needed sales people and that brokerage sales experience is the most desireable type of experience.
So they, the banks, lowered their sights and decided to start recruiting brokers from Merrill who were about to wash out.  I am aware of bank B/D officers who actually had dinner with the local wirehouse managers and told them that they, the bank, would be happy to hire brokers who were little more than dead wood at the wirehouse.
This allowed the wirehouse managers a bit of flexibility.  That broker out there in the office who is actually little more than a breakeven situation could be nudged out the door in the direction of the bank.
Oh sure, they might take a few accounts with them, but they're not making it here so how much damage can they do if they pulled all of their accounts with them?
That's a nice little story you painted, but hardly applicable THESE days...maybe 15 years ago, when you were only 60.
The bottom line is that banks are still trying to find their "sea legs."  A guy can make a career out of a bank, but a woman will find them to be more friendly.  In most of the senior officers are women and they are exceptionally women friendly environments.
Of all the statements you have made, THIS ONE is the most far-fetched and obviously oblivious to reality of ALL. 
Banks are NOTORIOUSLY male dominated, especially in the senior ranks.  You might find branch managers who are women, but move to City Presidents, Regional Exec's, and on up and almost ALL OF THEM ARE MEN.
Anyone who has worked at a bank or works at one know will concur.  You are dead wrong on this one!!!
It is true that they don't have to do a lot of prospecting--tellers will "bird dog" for them
"Mrs. Johnson, since you're cashing dividend checks it means that you are an investor.  Have you met Mrs. Jones our investment professional?
No?  Well, she's in our branch every Wednesday.  Could I arrange a meeting for you?"
That sounded pretty good.  Maybe I can swing you a chance at as a drive through teller at one of our branches.
They'll often give it a bit of a nudge such as, "We're having a contest for two tickets to the symphony and if you'll just meet with her I'll have a better chance of winning."  Who can turn that down?
The Symphony???  Geez you are old.  Maybe an Ipod or a couple hours off...but the symphony???? 
Now, remember that I"m old so I couldn't possibly know what I'm talking about as well as somebody who has been in the business since way back before Christmas.
No doubt you are old anyway.
 

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Note how BankFC was unable to debunk anything.  I'll not bother to cut the whole thing because they can get too long.  But a few comments.
1.  The reference to telling Mrs. Jones about tickets to the symphony was made in an effort to appeal to Mrs. Jones.  She is far more likely to be receptive if a teller says she can win tickets to the symphony instead of an IPod.  Mrs. Jones doesn't know what an IPOD is. By the way the NASD is not fond of tellers bird dogging like that, and I expected BankFC to deny it even happens--but instead he goes off the deep end and admits it happens with Ipods.
2.  The office next to the commercial lending department.  Not in most places, investment selling is still a red headed step child in the banking industry.  In a great many places a child-size desk is stuck over in the corner of the platform area of the bank and the BankFC type comes in one day a week.  Essentially they don't really have their own desk anywhere because they're in a different place every day.  I hear--from their managers--that they often carry things like a picture of their spouse and/or kids with them to put on their desk du jour.
3.  The long list of things he is provided--cell phone, laptop...blah, blah, blah.  That is not what I am talking about.  I'm talking about spending money to make you a real player.  Spending a hell of a lot more money on advertising, taking part in more underwritings, having a research group--there is more to a brokerage firm than the fact that the reps have cell phones.  By the way, the reason he has a cell phone is because he doesn't have an office.  The reason he has a laptop is because he doesn't have an office for a desktop terminal.  The reason they pay his mileage is because he's expected to go from place to place.
4.  Male dominated.  Just like any business males are dominant in the board rooms and along mahogany row.  But the Broker/Dealer division of most bank, credit union, S&L, etc. firms is headed by a woman.  That's not even open for discussion--it's not even close.
5.  Non interest income.  I did not say that banks didn't get income from their B/D divisions. What I said is that banks make more money on the spread than they do on a mutual fund or variable annuity sale charge. So, given a choice a banker would much rather sell a customer a CD than a mutual fund or VA.  The banks operate B/D divisions out of a sense of self survival--clients were taking their savings deposits to brokerage houses for years, money market funds paid more than savings accounts due to banking laws.
Then when the brokerage firms were allowed to offer check writing against the money market deposits the money started leaving the banks so fast you could feel a draft.  So, banks made the decision to go into the brokerage business--not that they wanted to, not that they like it, but because they had to.
They, the banks, still see brokerage operations as a compliance nightmare that could result in arbitration claims that wipe out years worth of efforts.
6.  Full arsenal.  Even BankFC cited something to do with shorting the Australian dollar while going long the British pound--or some such strategy.  I agree that 99.99% of investors have no need for it--but if you don't have it in your arsenal you don't have a complete arsenal.  Banks have fewer selling agreements with the major funds--nobody has one with every fund family, but you're damn sure going to have a better selection if you're a broker at Merrill with a desk and phone than if you're wandering around town with your cell phone and laptop.
That image, and that image alone, is enough to paint the bank broker in a negative light.  Put yourself in Mr. Johnson's place.  What do you think about a broker who tells you, "Well, on Monday I'm at the 23rd Street branch, unless I'm at the Elm Street branch.  Now that's only in the mornings of odd numbered Mondays.  If the Monday is on an even numbered date then I am at the Ohio Street branch but not until after the sales meeting."
If you're Mr. Johnson are you going to think, "Damn this guy is a real professional compared to those guys on the 42nd floor of that office tower downtown...."

BankFC's picture
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NASD Newbie wrote:
Note how BankFC was unable to debunk anything.  I'll not bother to cut the whole thing because they can get too long.  But a few comments.
This is my last response to you as I am off to enjoy my weekend.
1.  The reference to telling Mrs. Jones about tickets to the symphony was made in an effort to appeal to Mrs. Jones.  She is far more likely to be receptive if a teller says she can win tickets to the symphony instead of an IPod.  Mrs. Jones doesn't know what an IPOD is. By the way the NASD is not fond of tellers bird dogging like that, and I expected BankFC to deny it even happens--but instead he goes off the deep end and admits it happens with Ipods.
What a fool you are.  You think tellers actually LIE to customers about incentives in order to appeal to certain demographics????  There is not that much original thought in the process I can assure you.
2.  The office next to the commercial lending department.  Not in most places, investment selling is still a red headed step child in the banking industry.  In a great many places a child-size desk is stuck over in the corner of the platform area of the bank and the BankFC type comes in one day a week.  Essentially they don't really have their own desk anywhere because they're in a different place every day.  I hear--from their managers--that they often carry things like a picture of their spouse and/or kids with them to put on their desk du jour.
I can't speak for most places, only my own.  I have my own office.  Woo Hoo. 
3.  The long list of things he is provided--cell phone, laptop...blah, blah, blah.  That is not what I am talking about.  I'm talking about spending money to make you a real player.  Spending a hell of a lot more money on advertising, taking part in more underwritings, having a research group--there is more to a brokerage firm than the fact that the reps have cell phones.  By the way, the reason he has a cell phone is because he doesn't have an office.  The reason he has a laptop is because he doesn't have an office for a desktop terminal.  The reason they pay his mileage is because he's expected to go from place to place.
You certainly are an idiot, and probably never a retail advisor.  Because if you were, you'd know that "spending a hell of a lot more money on advertising...underwritings...a research group" has NEXT TO NOTHING to do with the individual success of an advisor.
If that was the case then every trainee at ML, MS, and UBS would make it...but instead it's almost a revolving door in some markets...why?  Because there is no support on the INDIVIDUAL LEVEL!!!  WHO CARES ABOUT YOUR RESEARCH IF YOU DON'T HAVE ANYONE WILLING TO OPEN AN ACCOUNT?
Again, your comments unmask your lack of experience as a retail advisor. 
 
4.  Male dominated.  Just like any business males are dominant in the board rooms and along mahogany row.  But the Broker/Dealer division of most bank, credit union, S&L, etc. firms is headed by a woman.  That's not even open for discussion--it's not even close.
You're simply wrong...no other way to put it.  Bank brokerages are no more female dominated than wirehouses...by the way, wasn't one of the top execs at SB a few years back a woman??? 
5.  Non interest income.  I did not say that banks didn't get income from their B/D divisions. What I said is that banks make more money on the spread than they do on a mutual fund or variable annuity sale charge. So, given a choice a banker would much rather sell a customer a CD than a mutual fund or VA.  The banks operate B/D divisions out of a sense of self survival--clients were taking their savings deposits to brokerage houses for years, money market funds paid more than savings accounts due to banking laws.
I love people like you, who make unsubstantiated claims as fact...  
Then when the brokerage firms were allowed to offer check writing against the money market deposits the money started leaving the banks so fast you could feel a draft.  So, banks made the decision to go into the brokerage business--not that they wanted to, not that they like it, but because they had to.
I guarantee you Chase Manhattan, Bank of New York, or any other bank for that matter failed to feel any "draft."
They, the banks, still see brokerage operations as a compliance nightmare that could result in arbitration claims that wipe out years worth of efforts.
Yeah, that's why banks like Wachovia promote investments so much...because they see it as a nightmare...wrong again. 
6.  Full arsenal.  Even BankFC cited something to do with shorting the Australian dollar while going long the British pound--or some such strategy.  I agree that 99.99% of investors have no need for it--but if you don't have it in your arsenal you don't have a complete arsenal.  Banks have fewer selling agreements with the major funds--nobody has one with every fund family, but you're damn sure going to have a better selection if you're a broker at Merrill with a desk and phone than if you're wandering around town with your cell phone and laptop.
I am now convinced you were never ever an advisor...because no advisor (at least a successful one) would make such a statement.  If an advisor can rest better at night knowing he can sell some obscure product, if that makes him feel more complete, well good for him.  I can sell EVERY mutual fund I ever sold at ML.  I have multitudes of SMA's.  Plenty of the top insurance companies. 
That image, and that image alone, is enough to paint the bank broker in a negative light.  Put yourself in Mr. Johnson's place.  What do you think about a broker who tells you, "Well, on Monday I'm at the 23rd Street branch, unless I'm at the Elm Street branch.  Now that's only in the mornings of odd numbered Mondays.  If the Monday is on an even numbered date then I am at the Ohio Street branch but not until after the sales meeting."
If you're Mr. Johnson are you going to think, "Damn this guy is a real professional compared to those guys on the 42nd floor of that office tower downtown...."
LOL...I do just fine.  Fact is, Mr. Johnson hated going downtown in the traffic, hates trying to find a parking spot, and really hates when his advisor starts trying to push this crazy structured note down his throat.  He doesn't give two sh*ts about the yen or the british pound.
That's why he moved his accounts to me down at the bank only two miles from his house his lender recommended. 
NASD, you will never convince me you were a broker, let alone a successful one.  I have found you out to be, albiet admittedly well read, a fraud.
So I am done with you.

babbling looney's picture
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NASD Newbie wrote:
Note how BankFC was unable to debunk anything.  I'll not bother to cut the whole thing because they can get too long.  But a few comments.
All of my comments are based on my frame of reference of being a Bank Investment Rep many years ago.  Things have probably changed since then. 
1.  The reference to telling Mrs. Jones about tickets to the symphony was made in an effort to appeal to Mrs. Jones.  She is far more likely to be receptive if a teller says she can win tickets to the symphony instead of an IPod.  Mrs. Jones doesn't know what an IPOD is. By the way the NASD is not fond of tellers bird dogging like that, and I expected BankFC to deny it even happens--but instead he goes off the deep end and admits it happens with Ipods.
This was something I hated (the teller contests) and glad that they are outlawed now.  They would send the crappiest and most time wasting referrals over to me.  It was embarrassing for me and the customer.  Half the time the customer (you note I don't say client) didn't have a clue why they were sent to my desk.
2.  The office next to the commercial lending department.  Not in most places, investment selling is still a red headed step child in the banking industry.  In a great many places a child-size desk is stuck over in the corner of the platform area of the bank and the BankFC type comes in one day a week.  Essentially they don't really have their own desk anywhere because they're in a different place every day.  I hear--from their managers--that they often carry things like a picture of their spouse and/or kids with them to put on their desk du jour.
This was pretty much true in most cases.  I was lucky in that I was a lending officer and investment officer with a permanent office.  I didn't have to travel to various branches, except in conjunction with the lending.  I was a sales person long before becoming a banker and enjoyed the investment side much more than the lending side which is why I am not there anymore.  
Most of the other reps had to bounce from branch to branch .  the worst thing about this is the lack of privacy.  You are discussing highly sensitive financial information right in the lobby of the bank for all to hear while they are waiting to cash their checks in the teller line.
 3.  The long list of things he is provided--cell phone, laptop...blah, blah, blah.  That is not what I am talking about.  I'm talking about spending money to make you a real player.  Spending a hell of a lot more money on advertising, taking part in more underwritings, having a research group--there is more to a brokerage firm than the fact that the reps have cell phones.  By the way, the reason he has a cell phone is because he doesn't have an office.  The reason he has a laptop is because he doesn't have an office for a desktop terminal.  The reason they pay his mileage is because he's expected to go from place to place.
It was always a bone of contention with me that we didn't advertise the investment services. Nothing in the paper, no lobby signs.  Most advertising was spent on at the Branch level for special promotions and occasionally the home office would do a bank wide campaign, usually on a loan or CD promotion.  Never anything about the investment program.
4.  Male dominated.  Just like any business males are dominant in the board rooms and along mahogany row.  But the Broker/Dealer division of most bank, credit union, S&L, etc. firms is headed by a woman.  That's not even open for discussion--it's not even close.
Well, this has certainly changed, if true.   In my day, women were at best branch managers.  All of the administrative positions were men.
5.  Non interest income.  I did not say that banks didn't get income from their B/D divisions. What I said is that banks make more money on the spread than they do on a mutual fund or variable annuity sale charge. So, given a choice a banker would much rather sell a customer a CD than a mutual fund or VA.  The banks operate B/D divisions out of a sense of self survival--clients were taking their savings deposits to brokerage houses for years, money market funds paid more than savings accounts due to banking laws.
Maybe they make more on the spread, but the revenue from the investment program is attractive because it isn't subject to reserve requirements.   When I started there was a great deal of resistance and animosity from the branch managers.  They look on the program as us stealing their demand deposits.   When the bank started directly compensating the branches for the lost deposits by revenue sharing from the investment income, the managers backed down a bit.
Then when the brokerage firms were allowed to offer check writing against the money market deposits the money started leaving the banks so fast you could feel a draft.  So, banks made the decision to go into the brokerage business--not that they wanted to, not that they like it, but because they had to.
They, the banks, still see brokerage operations as a compliance nightmare that could result in arbitration claims that wipe out years worth of efforts.
6.  Full arsenal.  Even BankFC cited something to do with shorting the Australian dollar while going long the British pound--or some such strategy.  I agree that 99.99% of investors have no need for it--but if you don't have it in your arsenal you don't have a complete arsenal.  Banks have fewer selling agreements with the major funds--nobody has one with every fund family, but you're damn sure going to have a better selection if you're a broker at Merrill with a desk and phone than if you're wandering around town with your cell phone and laptop.
This lack of product and the actual restrictions on being able to sell bonds, stocks or ETFs and the heavy emphasis on annuities is what drove me to leave the bank environment.  It is different now in that the broker dealer at the bank is generally able to  offer all the same products as any other b/d.
I think it depends on whether the b/d is out-sourced and is a nationally known company such as Raymond James, Financial Network etc or if the b/d is the bank's homegrown in-house platform.  Years ago, most banks had their own program and it was run by bankers who didn't have a clue how to do that, or who were sceptical about the entire idea. They picked the investments that we were allowed to present and put severe restriction on the sales force.  The representatives were drawn from the bank personnel (as was I) and as you said. Now I believe (and I may be wrong) that most regional banks (which is what the original poster was asking) use contracted broker dealer relationships and the investment representatives are not directly  bank employees.
That image, and that image alone, is enough to paint the bank broker in a negative light.  Put yourself in Mr. Johnson's place.  What do you think about a broker who tells you, "Well, on Monday I'm at the 23rd Street branch, unless I'm at the Elm Street branch.  Now that's only in the mornings of odd numbered Mondays.  If the Monday is on an even numbered date then I am at the Ohio Street branch but not until after the sales meeting."
If you're Mr. Johnson are you going to think, "Damn this guy is a real professional compared to those guys on the 42nd floor of that office tower downtown...."

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You're right I don't know anything about the industry, I'm just well read.
Retail producer--two NYSE wirehouses 1971 to 1977
Eleven months at the CBOE--covering all aspects of order entry and execution 1977 - 1978
Western and Southern Regional manager's staff--Institutional options strategist and internal wholesaler for options trading-- '78 to '82
If you had a client who wanted to know about listed options--they were new in the 1970s--I would be dispatched from the regional office to go on the call with you.
Or, actually more often than not, I was the guy who talked at the seminars that branches would arrange for cliens who wanted to know about the options market.
Regional staff--Interim retail branch office manager in six cities-- '82 to '88
Branches are often opened by an interim manager who will get the place together and then attempt to recruit a manager from another firm who often brings several producers with them.
I spent a year in a branch in North Carolina after the manager suddenly died.  I was trying to decide if I wanted to take it over permanently since the Carolinas are a great place to live.
It was not meant to be for a lot of personal reasons
Home office branch supervision and training 1988 to 2006
Contrary to the sneering on this forum home office types rarely care about paperclips.  Instead they focus on keeping the lives of the sales force as worry free as possible.
The rules of the NASD do not allow for no supervision, so when the fools talk about those who run their firms as leeches it is safe to conclude that they're just jealous.
If you're young and think you'd like to make things happen let your desires be known
 

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The representatives were drawn from the bank personnel (as was I) and as you said. Now I believe (and I may be wrong) that most regional banks (which is what the original poster was asking) use contracted broker dealer relationships and the investment representatives are not directly  bank employees.
 
That is something that I am interested in--perhaps a definitive answer is available among the readers of this group.
If I am a registered rep working out of the offices of a small bank in Iowa--using RJFS as our broker dealer--who do I work for?
The bank or yet another entity?

BankFC's picture
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Both.  You are considered a Dual Employee both of the bank and the b/d.  Our clearing firm is Pershing, and then we have a contracted B/D.  I am employed by them and our bank (my benefits, 401K, my check, etc come through the bank).
Are you going to fight me on this one too NASD?

NASD Newbie's picture
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BankFC wrote:
Both.  You are considered a Dual Employee both of the bank and the b/d.  Our clearing firm is Pershing, and then we have a contracted B/D.  I am employed by them and our bank (my benefits, 401K, my check, etc come through the bank).
Are you going to fight me on this one too NASD?

What does your business card say on it?  If a prospect looks at your card who will they assume you work for?

rankstocks's picture
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Joined: 2005-02-10

BankFC is truly a joke.
    He refuses to admit that he is laughed at at parties once other real brokers find out where he works. 
    He chooses not to believe that banks can't even get people's checking accounts correct, let along someone's serious money.
    He has decided long ago that working for a 20% payout is better than having to prospect for himself.
    His posts are the longest I have ever seen, leaving me to believe that he doesn't know how to keep thing simple, let alone sell.
    He has blinded himself from reality, hoping his managers don't take away assets, bank branches, referals, or cut his payout again.

bankrep1's picture
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ranks
I guarantee I squash your production

ChrisB's picture
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Joined: 2006-06-02

rankstocks wrote:BankFC is truly a joke.
    He refuses to admit that he is laughed at at parties once other real brokers find out where he works. 
    He chooses not to believe that banks can't even get people's checking accounts correct, let along someone's serious money.
    He has decided long ago that working for a 20% payout is better than having to prospect for himself.
    His posts are the longest I have ever seen, leaving me to believe that he doesn't know how to keep thing simple, let alone sell.
    He has blinded himself from reality, hoping his managers don't take away assets, bank branches, referals, or cut his payout again.Sorry, but you're living in a dream world. 

BankFC's picture
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Joined: 2005-05-27

NASD Newbie wrote:BankFC wrote:
Both.  You are considered a Dual Employee both of the bank and the b/d.  Our clearing firm is Pershing, and then we have a contracted B/D.  I am employed by them and our bank (my benefits, 401K, my check, etc come through the bank).
Are you going to fight me on this one too NASD?

What does your business card say on it?  If a prospect looks at your card who will they assume you work for?

My card says "Name of Bank" Financial Services in the upper left hand corner, in the upper right hand corner it says my banks name along with my office address.
In the lower right hand corner it states that "Securities are offered by "My Broker Dealer", Member NASD/SIPC
If a prospect look at my card, it is obvious for whom I work.  The financial services division of any bank will simply be set up as a subsidary...but will bear the same name.

Starka's picture
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Joined: 2004-11-30

Why should a broker in a bank be thought of as being any less of a broker?  If bank brokers are happy with their arrangement, I don't see why anyone else would care.

troll's picture
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Joined: 2004-11-29

Starka wrote:Why should a broker in a bank be thought of as being any less of a broker?  If bank brokers are happy with their arrangement, I don't see why anyone else would care.While I sometimes enjoy poking fun at our bank lobby colleagues, and while that is certainly not the choice for ME, I fully agree with you Starka.Diff'rent strokes for diff'rent folks.

BankFC's picture
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Appreciate the acknowledgement fellas.

NASD Newbie's picture
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joedabrkr wrote: Starka wrote:Why should a broker in a bank be thought of as being any less of a broker?  If bank brokers are happy with their arrangement, I don't see why anyone else would care.While I sometimes enjoy poking fun at our bank lobby colleagues, and while that is certainly not the choice for ME, I fully agree with you Starka.Diff'rent strokes for diff'rent folks.
It's the brokerage equivalent of playing for the Toledo Mud Hens--nothing wrong with it, but nothing to be proud about either.

eddjones654's picture
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Joined: 2004-12-03

NASD Newbie wrote:
It's the brokerage equivalent of playing for the Toledo Mud Hens--nothing wrong with it, but nothing to be proud about either.

I've heard that said about a certain "regional" outfit that is serviced by outdated satellite technology.
Banks B/Ds are usually cleared by Pershing,  National (a sub of Fidelity Funds) or even RJ and have access to considerably more research and usually no "preferred" fund companies.

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