GenSpring Family Offices' assets under management have plunged 31% since the sudden departure of high-profile CEO Maria Elena 'Mel' Lagomasino -- falling to $11.6 billion from $16.9 billion as of late 2011 -- and the firm is now facing the departures of its president and other top execs.

John Devine, the president of GenSpring since 2002, has left the firm, according to a company spokesman, and now identifies himself on his LinkedIn profile as partner and strategic advisor at Brown Advisory.

Other exits came earlier this week in Florida, as three top GenSpring advisors joined Evercore Wealth Management to open a new Tampa office for the New York-based wealth management firm. Julio Castro, a partner and wealth advisor for Evercore, headed GenSpring's Florida business since 2001, leading new business development and serving a member of the family office's national leadership committee. Castro is joined at Evercore by wealth advisor Michael Cozene and portfolio manager Arthur Noderer.

"It's hard to imagine how a firm can core out their entire leadership team and not have huge disruption at virtually every level of the firm -- financial performance, client experience, even operational continuity," says industry consultant Jamie McLaughlin, former CEO of Geller Family Office Services.


The exodus of high-level executives began when Lagomasino left in October 2012 after clashing with executives of the family office's parent, Atlanta-based SunTrust Banks, over the future course of the firm. Lagomasino started her own high-touch wealth management firm targeting ultrahigh-net-worth clients, WE Family Offices, with former GenSpring executives Michael Zeuner and Santiago Ulloa, in early 2013.

More departures quickly followed Lagomasino's. Among them: former marketing and investments chief John Elmes, now at J.P. Morgan Private Bank; former chief marketing officer Steve Barimo, who joined former chief investment officer Andrew Mehalko at AM  Global Family Investment Office; and former managing director of operations Pete Balderston, now at Private Client Resources.

Former top executives Jean Brunel and Eric Ridenour have also exited GenSpring in the wake of Lagomasino's departure.

GenSpring declined to comment for this story. SunTrust did not immediately return a request for comment.


SunTrust has been filling GenSpring's top spots largely with veterans from the bank. Lagomasino was replaced by Thomas Carroll, who had headed a sports and entertainment advisory team at SunTrust. COO Michael Santone is a SunTrust veteran and CIO Ernie Dawal was SunTrust's private wealth and institutional business CIO.

The hires appear to mark a cultural shift for GenSpring -- a former No. 1 on Financial Planning's RIA Leaders list -- where Lagomasino was an advocate for greater independence from the bank.

"GenSpring is all about the bank now," says an industry executive familiar with the firm, who requested anonymity. "It's a clear pattern."

"GenSpring is out there talking about the resources of SunTrust," agrees an industry consultant. "They're definitely more banking oriented."

Just this week, SunTrust executive John Frazer was named managing director of GenSpring client development for Georgia, Tennessee and the Carolinas. (He was joined by Dale Sands, who will lead client development efforts focusing on business owners and executives in the firm's South region.)

And last month SunTrust Private Wealth Management veteran Steven Cutcliffe was put in charge of GenSpring's new San Francisco office, along with wealth management executives William Oscher and Bill Hageboeck.


In January, GenSpring also opened a new office in Los Angeles, bringing the total number of offices around the country to 14. The recent growth spurt contrasts with Carroll's initial trimming of organizational budgets and shuttering of offices in Phoenix and Denver.

GenSpring continues to target ultrahigh-net-worth clients, and has emphasized expertise in such areas appealing to wealthy families as estate planning, family governance and education and private equity investments.

But industry skeptics point to the firm's sharp drop in AUM. The increased SunTrust influence on the family office has made it a more difficult sell to the ultrawealthy, say critics, given the bank's broad set of products and services aimed at a wider market.

"SunTrust is a great bank," says the industry executive, "but when ultrahigh-net-worth families think of a bank, that's not the one they think of."

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