© 2020 Arizent. All rights reserved.

$245M Invest practice spurns LPL, joins Kestra

Register now

An Invest Financial advisor with $245 million in client assets has joined Kestra Financial amid the massive movement following LPL Financial’s acquisition of the assets of National Planning Holdings.

Michelle Bender’s Potomac Financial Consultants bolted for Kestra, the No. 13 independent broker-dealer, rather than join LPL, the largest one, Kestra announced last week. The sole practitioner, who is based near Washington, D.C., followed an estimated 1,200 NPH advisors who picked other firms.

All together, advisors who have spurned LPL have taken roughly $30 billion in client assets with them. LPL’s CEO Dan Arnold has acknowledged the tough recruiting fight, but the firm predicts it will still retain about 70% of NPH’s business. After the first half of the transition, LPL said that it would add 2,000 NPH advisors with up to $75 billion in assets.

Rivals such as Cetera Financial Group, Advisor Group, Securities America and Commonwealth Financial Network have grabbed hundreds of NPH advisors. For its part, Kestra has snagged 183 advisors with $5.9 billion in client assets in overall recruiting for the past two years, according to the firm.

Earlier in March, for example, Kestra unveiled a hybrid practice with $270 million in client assets that came over from LPL in the fourth quarter. Bender split from her office of supervisory jurisdiction to join Kestra after the OSJ chose a different firm, she said in an email, declining to state which IBD.

Among recent career changes, Merrill Lynch lost brokers managing $2.2 billion to rival J.P. Morgan Securities.
February 20

Bender sees Kestra’s business development services as “strong enough to help launch my firm to the next level,” she said. Potomac has acquired two firms in the last three years, and Kestra’s similar product offerings to Invest, as well as the same Envestnet platform, also played a role in the decision, Bender says.

“When I interviewed LPL, I personally didn’t feel that complete independence was going to be possible,” Bender said. “I utilize third-party money managers for a large portion of my assets under management. Even though they said they would support them, they did seem as if they only wanted us to use their platform.”

A spokesman for LPL had no comment on her exit.

Bender formally aligned with Kestra on Nov. 29, according to FINRA BrokerCheck. In her 18-year financial services career, she spent seven years with Invest following tenures with PWA Securities, Mutual Service and 1st Global.

Kestra’s home office performs supervision of the Germantown, Maryland-based practice, which has also completed a custodial transition from Pershing to Fidelity. About 65% to 70% of the firm’s assets fall on the advisory side, with an average client account size of $1 million, according to Bender.

“Potomac Financial Consultants was looking for a partner who understands the ever-changing advisory industry and the dynamic nature of technology,” Kestra CEO James Poer said in a statement. He added that Kestra has “the resources needed to provide excellent client service while simultaneously growing.”

Poer has said his Austin, Texas-based firm, which has private-equity backing and 1,339 producing representatives, is an active buyer. Kestra purchased No. 44 IBD H. Beck from Securian Financial Group, the parent of No. 18 IBD Securian Financial Services, in a deal that closed in December.

For reprint and licensing requests for this article, click here.