Displaying items by tag: banks

First Republic Bank’s recruiting spree is paying off with the recent announcement that the bank nabbed a Morgan Stanley team managing $1.2 billion in assets for ultra-wealthy clients in Los Angeles. The six-person team is led by advisors Alexander H. Kadish, Nicholas Davey, and J.P. Garofalo, who generated a combined $9.2 million in revenue. The team, which specializes in helping executives with large corporate stock plan holdings, also moved with three support staff. In addition, another former member of their team, Robert A. Daly Jr., will continue to work with the team as an outside consultant. Daly and Kadish moved the team to Morgan Stanley in 2016 from J.P. Morgan Advisors. Kadish has worked at six firms over his 21-year career. He started at discount broker Banc of America Securities in 2001, then shifted to Smith Barney in 2003 and worked for Jefferies & Co before joining J.P. Morgan Advisors in 2010. Daly started his career at J.P. Morgan’s Bear, Stearns & Co. in 1998 and also worked at UBS Wealth Management USA before rejoining J.P. Morgan in 2009. Garofalo started with Wells Fargo Advisors in 2013 and has worked for Morgan Stanley, Ares Investor Services, and Nuveen Securities before returning to Morgan in 2020. The addition of the team brings First Republic’s 2023 recruiting total to four teams managing a combined $4.6 billion in assets.

Finsum:First Republic Bank lured away a $9.2 million team from Morgan Stanley bringing its recruiting tally for 2023 to $4.6 billion in assets.

Last week, Federal Reserve Bank of Chicago President Charles Evans said that volatility in the markets can create additional restrictiveness in financial conditions. Last week, global markets saw increased volatility triggered by turbulence in the UK markets. Investors in the UK were spooked by the government’s program of unfunded tax cuts, which sent the pound tumbling and the cost of government debt spiking. In fact, volatility bets last week were at their highest levels since March 2020. Evans said that “The U.S. economy and inflation are going to be largely dictated by the stance of monetary policy and everything else that is going on supply shocks, the labor issues we're dealing with. It is a case that financial market volatility can add to additional financial restrictiveness. So, anything around the world in terms of policy or developments like Russia's invasion of Ukraine can add to additional restrictiveness." Still, he did not indicate that financial conditions would change the Fed’s current course.

Finsum: Chicago Fed President Charles Evans stated last week that market volatility can create additional restrictiveness in financial conditions, but gave no indication the Fed would change course.

Over the past several months, financial firms are seeing an uptick in ransomware attacks. In fact, IT security professionals in the financial industry have noted that ransomware attacks have not only become more common but have also become more sophisticated. Cybersecurity professionals are seeing a new wave of threats that banks and investment firms are struggling to prevent. Over the past two years, financial firms are seeing more ransomware attacks that utilize outside service providers which are also known as ransomware-as-a-service. Firms are also seeing variants that have chosen different attack vectors, meaning they are now attacking other areas of firms such as corporate phone systems. According to Sophos’ The State of Ransomware in Financial Services 2022, 55% of financial service firms were victims of at least one attack in 2021, up from 34% in the previous year. The bigger issue for banks and other financial firms though is not just the number of ransomware threats, but their increasing sophistication.

Finsum:Financial firms are not only seeing an increase in ransomware threats, but the sophistication of attacks has also increased.

According to a recent Charles Schwab RIA Benchmarking Study, talent is the top strategic priority for RIAs. This matches a Talent Management Study from San Francisco-based RIA consultancy DeVoe & Co., which showed recruiting is the biggest concern RIAs face today concerning talent. A recent Barron’s article highlighted the challenges RIA face when recruiting advisors. Firms are facing headwinds such as a rapidly aging workforce, a lack of young advisors to take over, loss of talent from the Great Resignation, and competition from mega financial firms. Barron’s highlighted the fact that over one-third of advisors are likely to retire within the next 10 years according to a study by Cerulli Associates. In addition, according to a survey by Ameriprise Financial, advisory firms currently have an average of three open positions at their firms. Some RIAs are turning to college students to fill the talent gap as the competition for experienced advisors is immense, while others are recruiting from banks and offering perks such as firm equity, high cash compensation, and generous payouts.

Finsum:Due to an aging workforce and strong competition, recruiting is a top priority for many RIA firms.

According to an analysis of patent filings, compiled by GlobalData, there is a shrinking number of cybersecurity-related applications in the banking industry over the past three months, compared to the previous year. The most recent filings show that the number of related patent applications in the banking industry was 596 in the three months ending July. This is down from 1096 during the same period last year. This indicates cybersecurity innovation in the retail banking industry is dropping off. Capital One Financial was the top innovator in the banking sector in the latest quarter. The company filed 125 related patents in the three months ending July, down from 230 in the same period last. Visa was second with 109 patent applications. One company that has increased research is Truist Financial, which saw a 35.7% growth in related patent applications in the three months ending in July.

Finsum:While cyber crimes are on the rise, cybersecurity innovation in the banking industry is falling.