Raymond James’ incoming CEO shrugs off DOL rule
Senior brokerage executives continued to shrug off the potential impact of the Department of Labor’s new fiduciary rule, which many believe may be legally contested by the insurance industry at some point.
Stifel Financial Corp. CEO Ron Kruszewski on Wednesday morning during a conference call with analysts called the new rule “less restrictive than what was proposed.”
Later that same day, Raymond James Financial Inc.’s Paul Shoukry, the firm’s current chief financial officer recently tapped to take over as CEO next year, echoed those sentiments.
“The rule itself is, I think, much more manageable than the draft rule was,” Shoukry said in a call with analysts to discuss the earnings for the calendar year’s first quarter. “That’s an early read. The devil’s always in the detail, but I don’t think the rule itself and what it will require us to do today is – it doesn’t look too problematic at all.”
Senior officials at large, retail broker-dealers like Stifel and Raymond James sound relatively at ease with the new sales standards for employee retirement plans; released Wednesday, it is an overhaul of a 1975 regulation that the insurance industry has fought tooth and nail, as it will for the first time subject many agents selling fixed annuities to the Employee Retirement Income Security Act.
The early thinking from senior industry executive is that the rule will be more problematic for insurance companies that sell products like fixed annuity, which is an insurance contract and not a security.
“The big change is that the Department of Labor is redefining who is a fiduciary under ERISA,” said one senior industry executive who spoke anonymously to InvestmentNews. “And the problem for insurance firms is that they are not
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