LPL Financial Remains ‘On Track’ for Commonwealth Integration: CEO

LPL Financial is reiterating that its conversion of Commonwealth Financial Network is “progressing well,” while the firm has retained about 80% of assets and maintains an asset-retention target of about 90%, according to Chief Executive Officer Rich Steinmeier. 

The broker-dealer is also boosting its training efforts, so its Commonwealth advisors and their support members can gain access to various programs and tools to “hit the ground running” following the conversion to LPL, Steinmeier said on LPL’s latest quarterly earnings call.

While about 2,000 advisors have remained at LPL post-acquisition, more than 950 have decided to leave, according to a recent study by Muriel Consulting.  

Many of those advisory teams have joined competitors such as Kestra Financial, Cetera Financial Group, and Raymond James. On the other hand, many advisory teams have decided to ditch rivals to go independent. 

During the call, Steinmeier revealed that LPL is rolling out its in-house artificial intelligence tool, Cyan, which will help the broker-dealer “operate across all of the advisory workflows and deliver contextual real-time intelligence.” 

He went on to add that the firm can “win in head-to-head” against its competitors after it invested $2 billion to support its AI-powered tools. 

Steinmeier referenced LPL’s latest AI product, its Latitude technology platform, which rolled out earlier this week. The platform consolidates LPL’s capabilities into its ClientWorks advisor platform and Account View portal.

Concerning recruiting, LPL has seen advisory movement “move back in line with historical norms” and that the firm “is largely coming toward the end of the recruiting and education” period, regarding its integration of Commonwealth. 

“We still have advisors out, we continue to progress with them, to problem-solve with them, to get to solutioning with them. So, it’s not completely over, but as we have continued on that journey, we see more of our capacity to go back into the marketplace and engage directly with advisors,” Steinmeier said. 

LPL’s headcount was 32,475 at the end of the second quarter, up 1% from the first quarter and up 11% compared to the prior year, according to its latest earnings report. 

Total client assets reached about $2.56 trillion at the end of the quarter, a 10% increase and a 34% increase from the year-ago period.