Last June, when we published our survey results, many of the broker-dealer executives we spoke to said they were navigating the tumultuous economic downturn by renewing their commitment to building their firms. This meant investing in services like technology, recruitment and the expansion of their fee platform. Although few broker-dealer executives were anticipating significant growth in the near term, they were looking to capitalize on the inevitable economic rebound. By most (but certainly not all) indicators, the recovery is now in motion. But for most of the firms in Financial Planning's 25th Annual Independent Broker-Dealer Survey, it came too late to show up in the survey. The wait for growth continues.

This year's report, which tallies 2009's performance, also documents companies' inward view during fallow times. Although the dramatic seven-month stock market rally in 2009 certainly helped keep year-end revenues from plummeting too far, the overall survey results for the 81 participating firms-down from last year's record of 91-are less than impressive. In fact, only three firms in our FP50-the 50 largest independent broker-dealers, ranked by total revenues-reported positive revenue growth from 2008 to 2009. Compare that with last year (which reported B-Ds' 2008 results), when 11 firms in the Top 50 had positive growth.

Among the 50, Cambridge Investment Research led the way with a modest 3.2% revenue expansion, followed by Invest Financial Corp. (3.0%) and National Planning Corp. (1.3%). Meanwhile, LPL Financial's reign at the top of our FP50 list of total revenues shows no signs of wavering. But the leader board did welcome a new entrant: Ameriprise Financial Services (which had declined participation in previous years) debuted in the survey at No. 2, knocking Raymond James Financial Services down to third in total revenues. AXA Advisors and Commonwealth Financial Network rounded out the top five.

NO "WOW FACTOR"

Truth be told, there aren't many numbers in this year's survey that jump out at you. LPL Financial outpaced everyone again, with revenues just under $2.6 billion. It's an impressive figure for sure, but with the addition of Ameriprise to the survey ($2 billion in revenues), LPL's dominance looks a little less overwhelming. To put this in perspective: In last year's survey, LPL more than doubled the revenues of Raymond James, its closest rival. Raymond James finished 2009 with $851 million in revenues, AXA Advisors netted $491 million and Commonwealth had $488 million. Securities America ($412 million in total revenues) fell out of the top five this year. Meanwhile, Investment Centers of America made the biggest leap in our rankings, moving up 11 spots to 45th on our list. Securian had the biggest drop, falling 11 spots to 34th.

It's not that these revenue totals are bad or that they fail to impress. It's just that when the Top 10 list in terms of "revenue growth" actually includes seven firms whose revenues shrank, it's a telling sign of how challenging the year was for independent broker-dealers. Besides Cambridge, Invest and National Planning Corp., the top five in growth this year included National Securities Corp. (-0.3%) and Next Financial and LPL, which both finished at -0.8%. The biggest revenue losers in the FP50 were SagePoint Financial (-38.5%), Princor Financial Services (-37%) and ING Financial Partners (-25.9%). All of this is a far cry from the 2009 survey, when five FP50 firms experienced double-digit growth. It's an even bigger drop-off from 2008's edition in which none of the FP50 firms experienced negative growth, and only one of the 83 broker-dealers that participated in the survey failed to generate positive revenues.

TROOP SURGE

But even though no firm in this year's survey succeeded in putting up consistently strong numbers across the board, there were still some clear winners. For instance, any analysis of Cambridge's performance would have to begin with its stellar recruitment efforts. While the FP50 collectively dropped 2,757 reps from the previous year's survey, Cambridge boosted its total to 1,971 in 2009, from 1,632 the previous year-a 20.8% jump. The firm also increased its number of producing reps by roughly 22%.

LPL absorbed three broker-dealers, resulting in superior recruiting results by increasing its total reps to an astounding 11,214 from 9,315. This represents a 20.4% gain. National Securities Corp., one of the three FP50 firms to finish with positive revenue growth, also had a solid recruiting year. The New York City-based broker-dealer increased its total reps to 636 from 535 in 2008, or by roughly 18.9%. It also grew its corps of producing reps at a robust 24.5% clip. American Portfolios Financial Services (17.9%) and Geneos Wealth Management (11.4%) also had double-digit growth in recruitment. In addition, Triad Advisors, a new addition to the FP50 this year, increased its total reps to 450 from 400, for a 12.5% jump. Firms on the wrong side of the recruitment numbers included SagePoint Financial (-21.7%), Primevest Financial Services (-30.1%) and Investors Capital Corp. (-20.4%). Nineteen firms in the FP50 had a net gain of reps, while 20 firms had a net loss.