Cetera Financial Institutions is on the hunt for new banks and credit unions.
The TPM firm has lured a national sales executive from First Niagara Bank's investment services program to oversee the recruitment of new financial institutions to Cetera's platform. Bobby Huddleston joined the firm as senior vice president of new business development and will serve the northern part of the U.S.
The new hire follows the appointment of another executive to a business development role for the southern United States. Kyle Hallman, a former Raymond James regional director, joined Cetera in February as senior regional vice president of business development.
Huddleston and Hallman are supported by Cetera's director of new business development and training Sean Casey who "jumps in" and augments their efforts across the country, Catherine Bonneau, president and CEO of Cetera, told Bank Investment Consultant in an exclusive interview.
Mix of Startup and Takeover Programs
Cetera will look to recruit banks and credit unions that don't offer investment services programs as well as institutions offering programs through other broker-dealers, she says.
She anticipates that most of the new business will come from what she referred to as "takeover programs," meaning programs that Cetera manages to lure from its rivals. But business will also come from "startups" or the financial institutions that plan to start investment programs from scratch.
"It's nice to have a healthy mix between startups and takeover programs," Bonneau says.
Finding suitable financial institutions willing to launch startup programs is difficult and time-consuming as not all of them are equally committed to the wealth management business. "There are some institutions that are out there just saying that want to have it, so they can say they have it. They're not promoting it as part of their value driver for holding onto their clients," Bonneau says.
Sizing Up Appetite
"The art of the deal," she went on, is "sizing up the appetite of the host financial institution for making this offering of investment services core to their business."
And that's where the two recent hires come in, according to Bonneau. They're experienced enough in running successful investment programs that they "can size up senior management and say are they really serious about this startup or not," she says.
Already they've made progress. Since joining the firm in February, Hallman has developed a "very active pipeline of new financial institutions," Bonneau says, though she declined to provide details.
Cetera's push to recruit financial institutions, however, does not usurp the firm's efforts to grow its existing programs organically, which is Bonneau's first and foremost priority.
"We do both," Bonneau says. "If we weren't being mindful of new business development opportunities, we'd be neglecting the future health of the business."
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