The history of the wealth management industry is full of boom and busts. With every bull market, the industry seems to hire too many people, only to lay off staff during the subsequent bear market. This bull market, which began in March 2009, does not follow this same pattern. The industry seems to be in perpetual cost-cutting mode, even while the markets have soared, because the financial crisis fathered numerous giant mergers where many positions and locations are duplicated.

The biggest merger in the industry’s history occured when Morgan Stanley purchased 51% of Smith Barney from Citicorp in 2009 and closed the acquisition in 2013. The original  press release, issued in January 2009, said the merger would generate cost savings totaling $1.1 billion by “consolidating key functions including technology, operations, sales support, product development and marketing. These operational efficiencies represent approximately 15% of the combined firm’s estimated expense base, excluding financial advisors’ commission compensation.” 

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