Wachovia interview
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Deferred comp changes slightly from year to year, this year consists of three levels
1 - Percentage of total gross starts at $250K and I forget total amounts for each level.
2 - additional 1% if over 70% recurring revenue (fees, trails)
3 - Additional percentage based on percentage growth of gross over previous year. Highest amount paid for growth better than 15%
Compensation paid out over 5 years commencing in the fourth year. I believe if you meet all three levels a $300K would receive 5% of total gross.
1. UBS story is b.s. spin. Is your source on the corporate board or the broker/dealer board? Hostile takeovers don't work in this industry, trust me, my source is better then your source. Hint: only 3 executives and the outside board knew what was going on, I bet your source found out a few hours before the rest of the world. 2. Managers at WS are paid a salary + % of p&l, expect total comp to be no more then about 1% of branches gross on good years. 3. WS brokers get credit for money funds towards their grid, but the pay out is zero. I know AGE broker got paid on money funds, not sure for how long. 4. How do you limit manager production? If you do a good job for you customers, your production will always grow. I think you will see an exodus of AGE managers in small offices when they see the WS comp plan and the micro managment of their complex managers. I have a good friend that manages an AGE office, so again my info is accurate. You need to stop drinking the koolaid, WS has an incredible spin machine, (like most firms), if your happy, that is what's important. Be happy you are "with" wachovia securities.Mnbondguy Stop drinking the kool aid.
While I can’t verify what you said about WF, I can verify the UBS story.
I have been around this business for 30 years, and in that time have met and made friends with individuals who are now in other firms.
One of these was on the AGE board when they made the decision to sell, and why! Bagby couldn’t make the decision by himself could he? The board member voted for the merger sale and verified the UBS story to me.
A few other corrections.
“Many complex managers are in production.” True, but most are capped. offices with 20 or more, BOM’s are capped at $100K, others are capped at $300,000. Only the very small offices have totally unlimited production. That is the reason so many former managers have gone into the Profit Formula program.
“managers make no more then 1% in a given year”. Actually manager compensation is based on P and L. They can also be bonused by office revenue growth. Since they have oversight of Profit formula groups, those revenues are part of their P and L.
“WB reps do not get paid on money funds”. That’s funny! I wonder what that number is on my grid every month!
You may be right about the transaction fees, I don’t know since just about every portfolio in my book is either Asset Advisor or PIM. these accounts do not get charged transaction fees. Since every advisor in my office uses outside money funds it doesn’t seem to be a problem.
We do get notified if a debit memo is issued on the evening before a settlement date. Reps and their ops managers have to be real dunces if they don’t move the funds to cover the debit.
1 - I was told this by a member of the board!!! You are correct that only three executives and the independent directors knew it was happening. You are incorrect asserting that one of these people didn’t inform me. FYI they didn’t pick up the phone and call me. I found out this information several months after, in a social situation,
2 - I’m not going to argue with you on this one, since I am not privy to every managers P+L. BTW neither are You!!
3 - I said that we don’t get paid trails on Money funds, but we do get ot on the bank fund and it is net, and it is monthly.
4 - Managers can exceed their cap if they wish to. They just don’t get paid. There is no incentive to do so. I feel producing managers are a bad thing. Your biggest competition are your colleagues. You can take accounts from other firms, but you can’t from your colleagues. If your manager decides you are not “properly servicing” a client and takes that account for himself, you would find that a good thing9no. Unfortunately that happens too often when you have a producing manager.
As for exiting managers, Many of them will opt for “Profit Formula”, just as the Wachovia managers did when the non producing Prudential managers arrived. Whats better than getting a 70+% payout without having the problem of compliance, or other manager duties. It’s interesting that the managers who went that route had major increases in production and income as a result.
1. I did not get my info in a social setting. The UBS story is complete b.s., it is spin to justify the sale after telling people for years that AGE was not for sale, like I said, no such thing as a hostile takeover in our industry, management is just trying to convince AGE reps that ithis could have been worse if Bagby had sold to UBS. I can assure you that UBS never made an offer for AGE and never told Bagby they were about to make a hostile offer. 2. I don't need to know anybodys p&l to make that statement. As someone who has been in the industry for years, you should know that each firm has a target on what they will pay managers, at WB it is approx 1% of the gross on good years. They have a formula based on head count growth etc, but bottom line, expect about 1%. I know profitable AGE managers could make a lot more. 3. o.k. 4. What production level and how much of your own expenses do you have to pay to get this 70% pay out?? Stop the spin. Local control is good.1 - I was told this by a member of the board!!! You are correct that only three executives and the independent directors knew it was happening. You are incorrect asserting that one of these people didn’t inform me. FYI they didn’t pick up the phone and call me. I found out this information several months after, in a social situation,
2 - I’m not going to argue with you on this one, since I am not privy to every managers P+L. BTW neither are You!!
3 - I said that we don’t get paid trails on Money funds, but we do get ot on the bank fund and it is net, and it is monthly.
4 - Managers can exceed their cap if they wish to. They just don’t get paid. There is no incentive to do so. I feel producing managers are a bad thing. Your biggest competition are your colleagues. You can take accounts from other firms, but you can’t from your colleagues. If your manager decides you are not “properly servicing” a client and takes that account for himself, you would find that a good thing9no. Unfortunately that happens too often when you have a producing manager.
As for exiting managers, Many of them will opt for “Profit Formula”, just as the Wachovia managers did when the non producing Prudential managers arrived. Whats better than getting a 70+% payout without having the problem of compliance, or other manager duties. It’s interesting that the managers who went that route had major increases in production and income as a result.
This is my last posting to this individual.
It amazes me that the BS’er accuses me of BS. I get an admission from a reliable source ( a member of the former board), and he accuses that person of lying.
If you really are AGE legacy, you should also know about “Profit Formula” already. You can ask your manager to have them prepare a pro forma for you, to see if it works in your case.
The poster seems to forget that Wachovia started as J.C. Wheat and company, also a respected regional firm. Danny Ludeman worked for Jim Wheat, one of the finest men ever in this industry. The firm today knows and respects it’s regional roots. The liasion person is Jim Donnelly who is also a Wheat alumnus. This firm is as close to regional as you get today.
mnbondguy, I have met people like you all my career. They carp and carp. It’s not good for them and their collegues. If you are truly AGE legacy now at Wachovia, send a note to “Excellence First” with your suggestions.
I have not been at AGE in several years, they certainly did not have "profit formula", when I was there.
Call your contact and ask him to reconfirm that UBS made an inquiry to AGE, they didn't. J.C. Wheat was not owned by a bank. Does WB honor it's regional roots with high account fees and low money market yields?? No response needed.