The new chairman and CEO of A.G. Edwards says an acquisition might be in the cards.
“I want to make acquisitions if I find [targets] that are culturally acceptable to our current model,” Robert Bagby told RR Online Exclusives in a telephone interview from his office in St. Louis this morning.
Bagby explained that an acquisition could help boost revenues and spread the costs of technology over a broader base of financial consultants.
“I think with the scalability of technology and the revenues we need to support that technology, we’ve got to grow,” he says. “Everyone is spending more on technology than they would like to, but we’re going to spend what’s necessary to service our clients and service our financial consultants.”
Bagby says the acquisition could be any U.S. broker/dealer, but declined to offer anything more specific. He ruled out the possibility of buying an independent broker/dealer.
In an interview that focused on the changes he might make as the firm’s new leader, Bagby says one of his most crucial concerns is preserving the firm’s corporate culture, seen by some as slightly more broker-friendly than wirehouses.
A.G. Edwards will continue to allow brokers to copy their books and take them with them when they leave the firm, except when a branch clearly has been “raided,” Bagby says.
He also says the firm’s retail sales force is growing, despite the fact that he refuses to pay broker sign-on bonuses.
Bagby also took a swipe at Merrill Lynch and other wirehouses that are sending smaller clients to call centers.
“I wouldn’t want to be snubbed if I didn’t have $100,000, and I think I would remember that,” he says. “So I think what other major firms are doing [with smaller clients] is a real opportunity for our brokerage force, and I think that’s where we can truly distinguish ourselves.”
Bagby was named chairman and CEO effective March 1, 2001, replacing Ben Edwards, now chairman emeritus. Bagby was vice chairman and director of branches before the promotion. He is also a former broker. See the July issue of RR magazine for our complete interview with Bagby.
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