• Title: President & CEO
  • Time in Current Position: 4 years
  • Time with Firm: 4 years
  • Previous Employer/Title: Wachovia Securities, President and CEO
  • Years in the Industry: 34
  • First Job in Industry: Financial Advisor, Wheat First Securities
  • Alma Mater: BA, Virginia Commonwealth University; MBA, College of William and Mary

Now that you're retiring, what do you want to leave as your legacy in the industry?
DANNY LUDEMAN: I'm proud to have spent my entire career with a firm that recognized early on what you need to be a leader in our industry and that you must do what's best for clients. It was my privilege to lead the firm through a period of growth during which we brought together some of the most respected firms in the business and so many talented people who have strengthened our ability to serve and advise families. In the process, we created an organization that today, as part of Wells Fargo, is truly the preeminent brokerage firm in America. And because of our success, we've also been able to do so much to strengthen the communities we serve by sharing our time, our money and our ideas. I couldn't ask for more than that. And now I have the honor of taking what I've learned over 30 years in this business and serving the community on a full-time basis.

How have you balanced Wells Fargo Advisors' desire to put the client first with the corporate demand for shareholder return?
DL: I think that there's always a balancing act you need to keep in mind. First and foremost, your focus should be on the client, but you do have other constituencies. You've got financial advisors, your teammates, shareholders and also your communities. Those are the four constituencies that we look at. There are some companies that focus too much on the shareholder—if you do that then you take resources away from being able to invest and continue to add services for your clients. You can also underinvest in your team members. You want to make sure you're offering a compensation that's fair and that rewards doing what's right for clients. But if those investments get out of bounds, then it detracts a little bit from your shareholder returns. I think you've got to be careful when you talk about this. But I've sometimes noticed in firms that aren't growing very fast or that aren't producing adequate shareholder returns... well, if you [fail to generate shareholder returns] for a long time, you won't be in business. But some people use that as a Trojan horse. They use it as if to say, "We're not growing that fast on purpose." There's a little puffery involved with it, building themselves up by trying to excuse their lack of growth. If you are adding a ton of client value and your client loyalty scores are off the charts, clients are referring you to their friends and family, they're giving you their entire wallet share, both on the asset and liability side. It's impossible not to grow and provide very good shareholder returns. But I've seen a lot of people talk about it as an excuse.

Like, "We meant to do that."
DL: Yeah, a lot of times people say we're not doing that, we are purposely not growing as fast because we don't approve of that practice or this practice. Sometimes I've noticed that people define their value proposition by what they won't do, not what they will do. The financial services business moves pretty fast, and I've seen many firms—I may have been guilty of it myself a little bit—talk about what they won't or will never do in order to distinguish themselves in the marketplace. You have to keep an open mind, again, always making decisions on what's in the best interest of the client. Sometimes, though, people end up getting themselves in a box because they made too many absolute statements about what they won't do.

What do you think is the biggest challenge facing the industry?
DL: One of the biggest issues I think that our industry has now, and I think it's been this way for a while, is just a lack of organic growth. That's something that we're focused on. Regionals probably have the worst organic growth of anybody. Organic growth means existing FAs doing more business with more, new affluent clients. I'm not talking about growing the clients they currently have or recruiting new FAs. I'm talking about same-store sales. I think the industry has not been good at this. I think Fidelity and Schwab are very good at it. A lot of the problem has to do with two things. One, as our business becomes more fee based and less transaction based, recurring revenue creates a little bit more comfort.

Is "laziness" maybe the word you're looking for?
DL: "Leisure" might be another word; there is a leisure curve we could talk about. There's just not the same type of urgency to go out and bring in new affluent clients. I'd say the other one is that as people have morphed into planning advisory businesses, there hasn't been as much investment in what I would call true Marketing 101 in terms of attaining new affluent clients. I think the biggest opportunity is with the affluent now, but you're most likely going to be taking most of the affluent new clients from another organization. We need to do a little better job of helping the financial advisor with marketing and also making sure there's time in a financial advisor's day, every day, to do it. When I started off as a trainee, and today with most of the trainees we hire, that's all you're doing—going out and getting new affluent clients. Sometimes it's just as simple as making sure you have time in your week, that you've got a day and a half to focus on seminars or actively asking for referrals from existing clients. Or it could be networking with professionals in your region, like accountants, lawyers, doctors or whatever it is. But that's where the whole industry needs to do a better job in the long run.



  • Number of Employee Channel Advisors: 15,285
  • Total AUM: $1.3 trillion
  • Average Employee Advisor 12-Month Trailing Production: Not provided
  • Average Employee Advisor AUM: Not provided
  • % Women Advisors (Not including registered associates): Not provided
  • % Minority Advisors: Not provided

Read more: The State of Wealth Management

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