Raymond James Financial

Raymond James
Public
Traded as NYSE: RJF
S&P 500 Component
Industry Investment services
Founded 1962 (1962)
Founder Robert James
Headquarters St. Petersburg, Florida, United States
Key people
Products Financial services, securities and insurance brokerage, investment banking, asset management, banking and cash management, trust services.
Revenue Increase 5.40 billion USD (2016)
Increase $529.4 million USD (2016)
Website www.raymondjames.com

Raymond James Financial is an American diversified holding company providing financial services to individuals, corporations and municipalities through its subsidiary companies that engage primarily in investment and financial planning, in addition to investment banking and asset management.[1]

History

Raymond James was founded in 1962 when St. Petersburg broker Robert James formed Robert A. James Investments. In 1964, it merged with Raymond & Associates, founded by Edward Raymond in 1963, to form Raymond James & Associates.[2] Robert James' son, Tom James, joined his father's company in 1966 and assumed leadership of the firm in 1970. The firm initially planned to go public in 1969, but market conditions delayed its plan until 1983.[3] Tom turned over the CEO's post to Paul Reilly in 2010,[4] and transitioned his title as Chairman of the Board to Paul Reilly in 2016.[5] Tom still remains on the leadership team as Chairman Emeritus.

In 2012, the firm purchased the Canadian assets of Allied Irish Bank.[3] In April 2012, Raymond James merged with Morgan Keegan & Company. The merger created one of the country's largest full-service wealth management and investment banking firms not headquartered in New York.[6]

In January 2013, the firm reported 100 consecutive quarters of profitability.[7]

In June 2016, it was announced that Raymond James had joined the Fortune 500 for the first time.[8]

In September 2016, Raymond James announced its acquisition of Deutsche Bank Wealth Management's US private client services unit, Alex. Brown.[9]

As of April 2017, Raymond James has 7,100 financial advisors serving approximately 3 million client accounts in more than 2,900 locations throughout the United States, Canada and overseas. Total client assets under management are approximately $643 billion.[10] Raymond James corporate headquarters is located in St. Petersburg, Florida.

Activities

Raymond James Financial has three wholly owned broker-dealers, Raymond James & Associates (RJ&A), Raymond James Financial Services (RJFS) and Raymond James Limited (RJL); and Raymond James Investment Services Limited (RJIS), a majority-owned independent contractor subsidiary in the United Kingdom.[11] Through Eagle Asset Management, the firm manages $56 billion in assets mostly for institutions, as of October 2013.[3]

Controversies

Auction rate securities

On June 29, 2011, Raymond James announced an agreement to repurchase at par auction rate securities (ARS) sold to clients through its domestic broker/dealer subsidiaries prior to February 13, 2008. The agreement—reached with the Securities and Exchange Commission and with state securities regulators led by Florida and Texas—resolved more than three years of investigation related to activity in the ARS market. Without admitting or denying the allegations, the firm also agreed to pay a fine totaling $1.75 million to the state regulators, but was not fined by the SEC.

As a result of this agreement, a pre-tax charge of $45 million was recorded in the quarter ending June 30, 2011. This charge was a result of an estimate of the current fair value of the securities to be repurchased by the company being less than their par value. It is expected that the ultimate realized loss will be substantially less as issuers refinance or redeem these securities, interest rates rise and/or collateral values improve.

Raymond James sold $2.3 billion worth of ARS, underwrote $1.2 billion, and was the auction dealer for over $725 million. Since the $330 billion market for ARS crashed in 2008, at least 19 underwriters and broker-dealers were sued in class action suits.[12][13]

Excessive commissions

In September 2011, the Financial Industry Regulatory Authority ordered Raymond James & Associates, Inc. (RJA) and Raymond James Financial Services, Inc. (RJFS) to pay restitution of $1.69 million to 15,500 clients for charging excessive commissions on more than 27,000 securities transactions. The trades were made in client accounts between 2006 and 2010. FINRA also fined RJA $225,000 and RJFS $200,000.[14]

References

  1. ↑ "Raymond James Financial". Fiance.yahoo.com. Retrieved 19 October 2016.
  2. ↑ "Who Is Raymond James?". Raymond James Stadium. Retrieved August 11, 2014.
  3. 1 2 3 "U.S.'s Raymond James seeking to acquire Canadian equity management firm". Financial Post. Retrieved 2016-01-29.
  4. ↑ "Raymond James Company History". Raymond James Financial. Retrieved 2014-05-05.
  5. ↑ Kelly, Bruce. "Tom James to step down as chairman of Raymond James early next year". www.investmentnews.com. Retrieved 2017-07-18.
  6. ↑ "Raymond James to Buy Morgan Keegan & Company". New York Times. 11 January 2012. Retrieved 2012-06-17.
  7. ↑ "COMPANY HISTORY". Raymond James Financial. 30 January 2015. Retrieved 2015-07-28.
  8. ↑ "Here Are The 15 New Companies Joining The Fortune 500". fortune.com. 2016-06-06. Retrieved 2016-06-07.
  9. ↑ "Press Release - News & Media | Raymond James". www.raymondjames.com. Retrieved 2017-07-18.
  10. ↑ "RAYMOND JAMES FINANCIAL REPORTS 2ND QUARTER FISCAL 2017 RESULTS" (Press release). Raymond James Financial. 26 APRIL 2017. Retrieved 2015-07-28. Check date values in: |date= (help)
  11. ↑ "RAYMOND JAMES FINANCIAL INC.(RJF)- NYSE". Investorsbuz.com. Retrieved 19 December 2016.
  12. ↑ "Raymond James Announces Agreement to Repurchase Auction Rate Securities". Raymond James Financial. 2011-06-29. Retrieved 2012-06-17.
  13. ↑ "Raymond James auction-rate suit first to be upheld". InvestmentNews. 2010-09-09. Retrieved 2012-06-17.
  14. ↑ "FINRA Orders Raymond James & Associates, Inc. and Raymond James Financial Services, Inc. to Pay $1.69 Million in Restitution for Charging Unfair Commissions" (Press release). Financial Industry Regulatory Authority. 2011-09-29. Retrieved 2012-06-17.
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