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UBS aims for 25% increase in advisors at wealth center – Financial Planning

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UBS intends to ramp up hiring efforts at the firm’s Wealth Advice Center with a goal of boosting the number of financial advisors at the unit by 25% to about 170, according to people familiar with the matter.

The move mirrors similar efforts at other banks and brokerages that are embracing a hybrid model that mixes human and digital elements.

“This is a way for firms to expand their offerings in a way that is more resistant to fee compression,” says Will Trout, head of wealth management research at Celent, and who points to Vanguard as an example of one firm that is actively engaging more CFPs for its hybrid digital advice offering.

The firm’s recruiting initiative complements its recent rollout of UBS Advice Advantage, its new digital investment offering offered to clients of the Wealth Advice Center and is evidence that the firm sees rising demand for a hybrid digital-human advice offering.

UBS' partnership with SigFig to develop digital advice tools for its roughly 7,100 advisers is one example of fintech firms gaining a powerful financial brand as a partner. (Bloomberg News) UBS’ partnership with SigFig to develop digital advice tools for its roughly 7,100 advisers is one example of fintech firms gaining a powerful financial brand as a partner. (Bloomberg News)

UBS Advice Advantage, built in collaboration with tech developer SigFig over a roughly 18-month period, has a minimum investment of $10,000 and an advisory fee of 75 basis points.

“It’s high [relative to other digital advice offerings], but look at what UBS charges across the board,” Trout says.

The center, which has staff based in Charlotte, North Carolina, and Weehawken, New Jersey, is aiming to recruit already licensed financial advisors as well as newcomers to the profession. UBS runs two trainee courses twice a year in January and June.

UBS is also pushing to get more of the advisors at the Wealth Advice Center credentialed. Of its roughly 140 advisors, 54 hold the chartered retirement planning counselor designation. And under Leonard Golub, market head of the center, UBS is encouraging more staff to get the CFP designation. The firm has brought in a professor once a week to prep about three dozen of the center’s advisor for the CFP exam.

“Robo advice is commoditized,” Trout says. “So you have to expand you service offering if you’re going to compete there.”

Trout adds that this offering also makes UBS the primary owner of the client relationship, rather than the advisor.

To be sure, UBS isn’t the only brokerage broadening its call center profile. Bank of America recently announced plans to hire an additional 300 financial advisors for Merrill Edge, which is also a blend of digital and human advice. And by 2020, Bank of America intends to open 600 new investment centers within its retail consumer banking branches.

Merrill Edge currently has 2.4 million accounts and $184.5 billion in assets, according to the bank.

“[D]igital leaders in global wealth management have mostly mastered the first wave of the digital transformation and are now grappling with the long-term implications,” Onawa Lacewell, senior analyst at Swiss research firm MyPrivateBanking, writes in a recent report.

The longer firms wait to launch digital transformations, the greater the challenges they’ll have to overcome, she says.

The gap between the vanguard and the rest is growing, she writes, “and those banks currently lagging behind are now at high risk of losing clients if their digital transformations aren’t put in place soon.”

Andrew Welsch

Andrew Welsch

Andrew Welsch is senior editor of Financial Planning and On Wall Street.

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