RIA Merger & Acquisition Activity for First Quarter of 2013 Records Highest Number of Deals Since Q1 2012

RIA Merger & Acquisition Activity for First Quarter of 2013 Records Highest Number of Deals Since Q1 2012

RIAs and Strategic Acquiring Firms are dominant buyer categories in Q1

SAN FRANCISCO--(BUSINESS WIRE)-- The first quarter of 2013 closed with 13 completed merger and acquisition (M&A) deals totaling $5.8 billion in assets under management (AUM) within the independent registered investment advisor (RIA) segment, according to industry-wide data compiled by Schwab Advisor Services. This marks the highest number of transactions recorded in this sector since the first quarter of last year in which 17 deals were closed, totaling $24 billion in AUM.

Acquisition activity by RIAs increased this quarter, with 54% of the total transactions closed by this buyer category. Strategic Acquiring Firms, which recorded strong deal flow for the past year, were also a dominant buyer group in Q1, completing 38% of the total 13 transactions.

“Though it’s still very early in the year, this quarter’s strong deal flow among RIAs is an indication that advisors are using M&A to increase the scale and footprint of their businesses,” said Jon Beatty, senior vice president, sales and relationship management, Schwab Advisor Services. “Although we saw an increase in RIAs buying other RIAs in Q1, the overall deal size declined as we didn’t see a mega deal like we saw in Q1 2012. We do, however, remain encouraged by the flows we have seen to date.”

Early findings from Schwab’s 2013 RIA Benchmarking Study, the largest study of its kind focusing exclusively on RIAs, show that approximately 27%1 of RIAs surveyed are actively seeking to buy another RIA firm. For firms with $1 billion or more in assets, one-third are looking to make an acquisition.

“Given RIAs enthusiasm for mergers and acquisitions, coupled with the strong flows recorded to date, we believe there will be an increase in appetite for deals among RIAs moving forward if the economy improves and capital and liquidity becomes more accessible,” stated Beatty.

Schwab Advisor Services’ quarterly RIA M&A report is provided as part of the firm’s continued commitment to advancing the interests of RIAs across the business lifecycle. This includes supporting advisors through each phase of the process of starting, running, growing and exiting a business.

About Schwab Advisor Transition Services™

Schwab Advisor Transition Services helps advisors think through growing and exiting a business at the right time, with the right people and at the right value. This includes goal setting, evaluating options (internal succession, external sale, and merger or acquisition) and executing a transition plan.

Schwab’s Transition Services includes Schwab’s M&A Listing Service, an online database offered to independent registered investment advisors that custody with Schwab Advisor Services. The service connects advisor firm buyers and sellers and enables advisors to maintain anonymity while soliciting interest and collecting information from other advisor firms on acquisition, mergers, or sales. Buyers also can search for investment professionals with books of business who would like to join an RIA firm.

Additional information and new transitions content are available at www.SchwabTransition.com2

About Charles Schwab

The Charles Schwab Corporation (NYSE: SCHW  ) is a leading provider of financial services, with more than 300 offices and 8.9 million active brokerage accounts, 1.6 million corporate retirement plan participants, 888,000 banking accounts, and $2.08 trillion in client assets as of March 31, 2013. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; compliance and trade monitoring solutions; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at www.schwab.com and www.aboutschwab.com.

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All data compiled and analyzed by Schwab Advisor Services. Data reflects firms being sold with assets under management exceeding $50 million as of March 31, 2013.

1The RIA Benchmarking Study from Charles Schwab is the leading benchmarking study in the RIA industry and is designed to capture trends and best practices in the industry. This annual study is comprised of self-reported data from advisory firms that custody their assets with Charles Schwab. The 2013 RIA Benchmarking Study was fielded February and March, 2013. The Study contains self-reported data from 1,025 firms and is not verified or validated. Results reported here are for firms with more than $100 million in AUM unless otherwise noted. Each participating advisory firm submitted only one set of responses. All information contained in the Study is provided for general informational purposes only.

2The information provided on the Site is for general information purposes only and is not intended to provide specific financial, accounting, tax, legal, or regulatory advice. Schwab makes no representations as to the accuracy or appropriateness of the information for any given situation.

Schwab may limit what can be listed on the M&A Listing Service. Buyer listings and Career Opportunity listings are generally, but not always, limited to independent investment advisors that custody their clients' assets with Schwab Advisor Services. Schwab Advisor Services may further limit Buyer listings and Career Opportunity listings to those of its clients with whom it has favorable business prospects. Schwab Advisor Services has a financial interest in, and compensation received by Schwab Advisor Services personnel is affected by, the retention and growth of assets custodied at Schwab Advisor Services. This may incent Schwab Advisor Services to decline some proposed Buyer and Career Opportunity listings.

Independent investment advisors are not owned by, affiliated with or supervised by Schwab.

© 2013 Charles Schwab & Co., Inc. (Member SIPC) All rights reserved. (0513-3279)



Charles Schwab
Anita Fox, 415-667-1308
Anita.Fox@schwab.com
or
The Neibart Group
Sarah Gormley, 718-875-2122
sas@neibartgroup.com

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