Despite Flat AUM, a B-D's AM Arm Breaks Records
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Friday, November 1, 2019

Despite Flat AUM, a B-D's AM Arm Breaks Records

A publicly traded broker-dealer's asset management broke a couple of its records last quarter, despite flat AUM.

James Cooper Abbott
Carillon Tower Advisers
President, Chairman
Paul Reilly, chairman and chief executive officer of Raymond James, stated on the St. Petersburg, Florida-based firm's fiscal Q4 2019 earnings call that its asset management unit's "Financial assets under management end of the fiscal year at $143.1 billion, an increase of 2% over September, 2018 and flat compared to June, 2019. Overall, the growth in financial assets under management continues to be largely driven by equity market appreciation and positive inflows associated with the increase utilization of fee-based accounts in the Private Client Group segment, which has more than offset than that outflows experienced by Carillon Tower Advisers given the extremely challenging market environment for actively managed products. RayJay's fiscal Q4 2019 ended on September 30, 2019, and Carillon Tower [profile] is RayJay's multiboutique asset management arm.

According to the Fourth Quarter and Fiscal Year 2019 Results , in fiscal Q4 2019 the asset management unit brought in unaudited quarterly net revenues of $178MM (a record), up 3 percent over the prior year's fiscal fourth quarter and 1 percent over the prior quarter. The unit's quarterly pre-tax income rose 8 percent year-over-year and six percent quarter-over-quarter to a record $69 million. Asset management and related administrative fees revenue were $924MM (out of $2.085 billion for all of RayJay).

Overall, Raymond James has beat analyst's non-GAAP EPS expectations by $0.09, but missed analysts' GAAP EPS expectations by $0.05 (GAAP).

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