NEW YORK (TheStreet) -- Wealth management acquisitions are poised for a pickup later this year, with the latest rumors in the sector centered on the possibility that Wells Fargo (WFC) would want to acquire UBS (UBS) U.S. wealth operations.
Wells Fargo Chief Executive John Stumpf has said in several interviews that the firm is on the hunt for acquisitions in its wealth management business. Since 2009 there has been speculation that UBS, has been in talks with Wells Fargo about selling its U.S. wealth management business to shape up after the financial crisis.
"It makes sense. Wells has integrated a lot of acquisitions and by doing this one they would be just as big as Bank of America Merrill Lynch (BAC) and Morgan Stanley Smith Barney (MS)," said Jeff Spears, a co-founder and CEO of Sanctuary Wealth Services LLC. "The two have different types of clients so there would be little overlap."
Wells list of recent acquisitions includes Wachovia Corp., A.G. Edwards & Sons Inc. and First Union Corp.. The bank is expected to finish its integration of Wachovia by the end of this year.John Dowd, regional managing director for the Northeast Region of Wells Fargo Wealth Management told TheStreet that the firm did have the opportunity to make some acquisitions. Although Wells Fargo stated of the rumors that Wells was pursuing UBS wealth management that, "Any talk about a possible Wells Fargo deal with UBS is based on pure rumor and speculation." Wells is not the only bank pursuing acquisitions in wealth management right now, Bank of New York Mellon (BK) is also seeing opportunity in the market to make acquisitions, Lawrence Hughes, CEO of BNY Mellon Wealth Management told TheStreet. "We are always looking for quality firms," says Hughes. "We would be interested in firms in the Dallas, Houston, and Phoenix areas and internationally we would be interested in expanding in Brazil or the Asian markets." Dowd said there are several wealth management firms and registered investment advisories that could be rolled up this year due to regulatory and compliance costs pose capital challenges for smaller wealth management brokerages. "Besides the regulatory costs, you have to have the investment in the infrastructure which a lot of smaller firms don't have to compete. In addition, a lot of the smaller firms can't differentiate products their clients want," said Dowd. Hughes says that there will be more consolidation as principals of smaller firms retire, smaller firms look to broaden product lines for clients.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV