Southwest Securities maintained its growth into the second quarter of 2013 as the firm reported improved results across its four divisions.
The company continues to move past some of the drags on its revenue including a cease and desist order at the banking subsidiary and some challenging economic and recruiting conditions that the company cited in previous earnings reports.
In the retail segment, which employs around 400 advisors, the firm posted its second consecutive quarter of positive earnings. After a $1.9 million decline in profit in the fourth quarter of 2012, the division declared a net income of $528,000 for the second quarter of 2013. That number is well ahead of the $319,000 reported in the first quarter and the net loss of $219,000 reported a year ago.
We are pleased with our second quarter results, as each of our four business segments clearing, institutional, retail and banking showed improved pre-tax results as compared to the same period last fiscal year," said James H. Ross, Chief Executive Officer of SWS Group, Inc. "With the recent termination of the cease and desist order at our banking subsidiary and our strong capital position, we believe we are better positioned to build momentum across all of our business lines."
Results were driven by a $1.0 million increase in advisors fees and augmented by a $549,000 increase in insurance product revenue as compared with the second quarter of 2012. Total customer assets also jumped from $13.0 billion to $13.6 billion over the year.
Net revenues were off slightly from last quarter, down approximately $2 million from $28.1 million, but up from $25.2 million last year.
Income was offset by a $493,000 decrease in commission revenue in the independent contract business and a one percent increase in operating expenses within the retail segment as compared to the same period last year.
The overall results for the Dallas-based firm reflected similar growth as net income hit $10.4 million compared to a net loss of $14.3 million in the second quarter of 2012.