Schwab details plans for TD Ameritrade Institutional offices

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As it embarks on integrating TD Ameritrade, Charles Schwab is cutting branches, reducing staff and letting go of the TD brand.

But other elements are here to stay. For instance: TD offices that service financial advisors, according to Bernie Clark, head of Schwab Advisor Services. Clark spoke to RIAs last month on a recorded webcast shared with Financial Planning by a source who was granted anonymity to do so.

From the perspective of the independent advisor, “we are keeping all of the locations that TD had in complement to the locations that we had,” Clark said. That includes TD’s San Diego office, which has “some great teams,” Clark said, and serviced many of the RIAs custodying with TD.

His comments indicate how Schwab is proceeding with its integration of TD Ameritrade and how it will service relationships with thousands of RIAs that custodied with TD. To be sure, it’s an evolving process for Schwab and work remains to be done.

Responding to a request for comment about the webcast, company spokesman Rob Farmer said in an emailed statement that Schwab would maintain a presence “in many regions complementary to our existing footprint.”

Farmer did not respond to follow-up questions.

Clark told advisors his team was working to bring DocuSign “to parity between the two platforms.” Some familiar faces from TD Ameritrade are here to stay as well. For one, John Tovar, who served as managing director of wealth management services at TD Ameritrade Institutional. He is a “key part” of the leadership team at Schwab Advisor Services, according to Clark.

Tovar, who also spoke on the webcast with advisors, has been “at the forefront” of planning the TD Ameritrade transition, he told RIAs.

“We do recognize there's going to be change,” Tovar said. “There'll be highs. There'll be lows as we step through this process.”

Of course, many decisions still lie ahead. Schwab hasn’t determined how it will unite TD Ameritrade’s Southlake, Texas, office with Schwab’s Westlake, Texas, location, which will become the combined entity’s new headquarters, Clark said.

“We're going to think about how we bring those into one,” Clark said.

As for TD’s LINC conference, which had its 2021 rendition canceled mainly due to the coronavirus, Clark said it was too early to say what will happen, although he added that he doesn’t “see us running separate conferences and separate events.”

John Tovar, who served as managing director of wealth management services at TD Ameritrade Institutional, has been a key player in Schwab’s TD integration.

Farmer said in the emailed statement that Schwab would “continue to evaluate the events strategy” and will make further announcements when decisions are made.

There are also tech platforms to combine, and thousands of new firms to onboard.

With its purchase of TD Ameritrade, Schwab will custody assets for more than 10,000 RIAs, Clark said. Approximately 5,000 of TD’s advisors are new relationships for Schwab, the company said earlier this month during a session of its Impact conference.

On the webcast, Clark answered questions about technology and service. Both he and Tovar emphasized that the culture between the two custodians was similar.

“I saw no difference between Tom Nally and I when we would talk about things,” Clark said. Nally left the firm earlier this month.

Clark also addressed the issue of whether Schwab competes with RIAs for clients, which he said has been a recurring question “for my entire career going back to 1998.”

Because Schwab seeks clients looking for investment services, “that is a competition,” Clark said. However, Schwab has put the “appropriate barriers and restrictions” in place to prohibit it from “drifting” into competition with RIAs and engaging with advisors’ clients.

Of job cuts and consolidation, Schwab COO Joe Martinetto provided details on the company’s Oct. 29 earnings call. Initial efforts were focused on senior and executive level management and branches. Now, Schwab will consolidate roles in the corporate headquarters and convert both organizations to a single HR platform, which will include eliminating technology and more positions.

“Those will occur over the course of the next couple of years,” Martinetto said on the earnings call.

Schwab is keeping approximately 55 of TD Ameritrade’s retail branches. The combined entity will have more than 400 branches, 140 of which will be shared between the companies, he said.

As a result of the acquisition, former TD Ameritrade executives are moving into new roles across the industry, many of them to competitors.

LPL Financial, Envestnet, Robinhood, Google and Goldman Sachs have all been recent benefactors of the exodus of TD Ameritrade talent, according to company announcements and LinkedIn.

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Charles Schwab M&A Clearinghouses/custodians Career moves Consolidations Layoffs Bernie Clark Premium Access