9 quit Wheat First Union, open rival Tucker office

Veteran brokers balk at selling banking products

Financial services

June 08, 1999|By Bill Atkinson | Bill Atkinson,SUN STAFF

Nine employees at Wheat First Union, including a team of four veteran brokers, quit the firm's Baltimore office and opened a local branch yesterday for competitor Tucker Anthony Inc.

The group, led by Charles W. "Pete" Shaeffer Jr., told superiors at Wheat First Union on Friday afternoon that they were leaving the company to join Tucker Anthony, a Boston-based brokerage firm that has aggressively moved into Maryland in recent weeks, Shaeffer said.

"My whole team went," said Shaeffer, who heads the Shaeffer Investment Consulting Group, which manages about $600 million in client money, and hopes to bring it all to Tucker.

This is the second group of brokers in the area to bolt in recent weeks from a bank-owned firm to join Tucker Anthony.

Late last month, 19 Alex. Brown Inc. employees, including 10 brokers, in the firm's Annapolis office left for Tucker Anthony, which opened an office in the state capital in late April.

The brokers took with them about $1 billion in assets, and prompted Alex. Brown to close its Annapolis office. Alex. Brown last week became part of Deutsche Bank AG, a giant banking company based in Frankfurt, Germany, that bought Brown's parent, Bankers Trust Corp. of New York.

"We are in a situation right now where there are a lot of people coming to us," said Charles Godwin, national sales manager at Tucker Anthony, who managed the Wilmington, Del., office for Alex. Brown before it was closed last year. "It made a lot of sense to be in Baltimore."

A Wheat First Union spokeswoman said she had no information on the brokers' departure and could not comment. Godwin said he does not expect Tucker Anthony to expand in Maryland beyond the offices in Baltimore, Annapolis and Easton, where the company opened a small branch in April.

"We are not trying to get big, we are trying to get strategic," Godwin said.

Tucker Anthony, which operates about 40 offices from Portland, Maine, to Chicago, has benefited from mergers between banks and brokerage houses. The mergers have unsettled some brokers, who feel the cultures are not compatible.

Wheat First, formerly known as Wheat, First Butcher Singer Inc., agreed to sell to First Union Corp., the Charlotte, N.C., banking company, in August 1997.

Shaeffer said he began talking with colleagues a year ago about where they thought the industry was heading, and whether his group should leave Wheat, where he has worked for 10 years.

Moving is a "major task," he said. "You do it after a lot of thought."

Shaeffer said members of his group decided they wanted to work for a firm that was focused on the securities business, and not owned by a commercial bank.

After First Union bought Wheat, he said, the cultures did not "mix very well." First Union asked brokers to sell a variety of banking products to their clients.

"We really felt that we needed to be with a firm whose business was 100 percent securities business," Shaeffer said. "We didn't want to sell checking accounts and that kind of thing."

He said the brokers asked themselves if they could offer "personalized service and unbiased advice" working at Wheat First Union. "We weren't so sure in the long run," Shaeffer said.

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