UBS Wealth Management Americas made some cuts at its headquarters that some market observers say were widely expected, but the next step will hit closer to home for advisors.
The company cut about 200 back-office jobs, mostly in New Jersey, but some of those cut were high-level managing directors including Doug Black, the chief operating officer of private wealth management for ultra-high-net-worth clients; Jay Messing, the head of private client sales; James Pierce, a vice chairman in the wealth management Americas unit; Michael Roberts, head of trust services in the wealth planning group; and Jamie Price, the former head of the wealth management advisor group, who was most recently working with key clients, business strategy and development.
The layoffs were mostly geared to reduce the levels of management between advisors and the home office to make the business more nimble and responsive to advisors' needs, according to a company spokesman. There were also some cases of redundancies. The cost savings from the cuts will be reinvested in the business, mostly on the technology side, to address a lot of advisors’ concerns.
A spokesman for UBS said that no advisors were cut, but declined to provide further details until Robert McCann, the chief executive officer of UBS Wealth Management Americas, presents his business strategy in the next few weeks.
But others in the industry had no such qualms.
Industry recruiter Rick Peterson said that the industry buzz was that McCann had been telling people that UBS [UBS] was overstaffed at headquarters for the number of brokers it had. Peterson said that this round of cuts was widely expected.
To be sure, Peterson has been saying for months that UBS had too much infrastructure for its number of advisors, and that McCann had to either cut infrastructure or add a significant number of advisors.
The next step, Peterson said, is likely a “significant streamlining” of the field. If it really wants to beef up its ranks and compete head to head with the other three wirehouses, which are all twice as big in advisor headcount, it would have to recruit more, he said.
UBS would have to consider an acquisition of another wealth management firm and that would be difficult, Peterson said. Recruiting could, at best, stem the flow advisors leaving, he said.
But even that will be difficult with the current pay packages it offers, according to recruiter Mindy Diamond. She said these cuts at UBS are not sitting well with advisors, many of whom feel that the company is dressing up the unit for a sale. Indeed, that would be a welcome announcement for many of the advisors, she said.
Both Diamond and Peterson said that UBS no longer has an identifiable image with advisors. At one time, it had a boutique feel that gave it some swagger, but that’s been lost over the past two years of bad press, Diamond said.
Meanwhile, UBS plans to add to its wealth management headcount in Asia because of expected economic growth in that part of the world, according to a press report, which cited the Straits Times, a Singapore-based newspaper.