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HomeWealth Management$1B Maryland RIA Provides Goldman Sachs as Custodian

$1B Maryland RIA Provides Goldman Sachs as Custodian

Sargent Funding Group, a Bethesda, Md.-based registered funding advisor with $1 billion in belongings throughout 400 purchasers, has added Goldman Sachs Advisor Options as considered one of its custodians. Whereas the RIA presently custodies primarily with TD Ameritrade Institutional, which will probably be merged into Schwab throughout Labor Day weekend, SIG expects to maneuver the vast majority of its belongings to Goldman Sachs by the tip of this 12 months.

SIG was based in August 2018 by Brian McGregor, Christopher Sargent and Ricardo Rosenberg, after breaking away from Wells Fargo Advisors.

McGregor, co-founder and managing principal at SIG, mentioned his agency selected TD Ameritrade as its major custodian in 2018 as a result of, on the time, it was the one one of many massive custodians that didn’t additionally provide advisory companies. However the agency noticed the TD/Schwab conversion as a chance to take the agency to the following degree.

“The best way Goldman is structured, they don’t provide advisory companies in the identical universe because the custodial companies, which for us, is a gorgeous prevention of what we might nearly see as form of an inherent competitors,” McGregor mentioned.

Goldman’s Private Monetary Administration group, which incorporates the previous United Capital enterprise, sits in a segregated division from custody, which is housed in international banking and markets.

“Given some consolidation within the custody house, we’re seeing an incredible quantity of alternative to maneuver belongings to the Goldman Sachs Advisor Options platform,” mentioned Jeremy Eisenstein, co-head of the RIA custody gross sales group inside Goldman Sachs Advisor Options, in a Could 2023 interview with “Current unbiased RIAs are on the lookout for further selection; they discovered one with Goldman Sachs Advisor Options.”

McGregor mentioned his agency was additionally drawn to Goldman’s ‘white-glove’ service. With the Schwab conversion, the overwhelming majority of communication has been by way of pre-recorded tutorials.

“And that’s how guys and gals who’re sit in our seat are supposed to know how one can take the following steps and what’s going to occur,” he mentioned. “What occurs at Goldman is we ask questions, we arrange calls, and we’ll stroll via step-by-step what to anticipate via the transition, how one can put together for it.”

“Having the capability to talk with the administrators and decision-makers within the varied product traces that we’ll use could be very, very totally different than working with a big custodian,” he added. “That’s, as we see it, what it means to be ‘white-glove.’”

Goldman Sachs has been an energetic custody supplier since its acquisition of Folio Monetary in September 2020 and has onboarded many new RIA groups past the legacy Folio purchasers.

In June 2021, Goldman Sachs Advisor Options scored its first custodial shopper because the Folio acquisition, hybrid RIA Steward Companions. In August, reported that Steward was within the strategy of including BNY Mellon’s Pershing as a custodian. Steward stays a custodial shopper of Goldman’s.

Final October, a $1 billion breakaway group, Beverly Hills Personal Wealth, selected GSAS as its sole custodian. In January, a group of advisors led by Margaux Fiori departed Raymond James’ unbiased contractor division to kind their very own RIA, Fort Lauderdale, Fla.–primarily based Fiori Monetary Group, with GSAS as custodian. Then in February, a bunch of founding advisors got here collectively to kind United Advisor Group, a brand new RIA and RIA aggregator, with GSAS as its major custodian.

Most not too long ago, Prime Capital Funding Advisors, a quickly rising RIA agency with greater than $20 billion in shopper belongings, added GSAS as custodian, with plans to maneuver $1 billion in belongings to the custodial platform.

Some printed reviews say that Goldman is lagging behind a deadline it had for the RIA custody service, however Goldman executives mentioned the agency has by no means publicly expressed any “time line” and there may be unlikely going to be a ribbon-cutting sort of unveiling at any particular date sooner or later; as a substitute, Eisenstein mentioned to anticipate a quiet, steady iteration of the service. 

“We knew that it could be massive information,” Eisenstein mentioned. “We knew it was our first foray into the custody house, however there was by no means, ‘Hey in a 12 months from now, we’re impulsively going to open the doorways.’ We knew that we have been shopping for a enterprise that had belongings on it. It will not be precisely the corporations that we have been going to in the end going to go after as we at the moment are. Nevertheless it was an effective way to jumpstart us into this house—nice know-how, nice folks.”

Executives say the custodian has been very selective within the groups it brings onto the platform; particularly they’re on the lookout for growth-oriented, professionally-managed groups.

“We don’t need to dilute the model, and we definitely don’t need to dilute the service as a result of everyone knows service is the No. 1 level of frustration that advisors are specializing in,” Eisenstein mentioned. “We’re just a little bit later to the house—or what I name ‘strategically tardy’—however we all know what to not do or the place to not focus. And that’s serving to us as we take into consideration what this appears like in an area that’s massively dominated by three or 4 gamers right this moment.”



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