“Our new integrated approach to recruiting now puts us in a position where all advisors looking to transition are candidates to come to CI,” MacAlpine said. In addition to CI Assante and Aligned, the firm also has a CI Private Wealth business and a CI Investor Services platform — for advisors who “want to go completely independent,” MacAlpine said – as part of its Canadian wealth management business.
MacAlpine also said that “at some point,” Aligned will adopt a CI-linked brand name to match the integrated branding initiative the company launched two years ago.
“The reason we hadn’t prioritized that [rebranding] is because Aligned is more of a platform for advisors to plug into as opposed to a brand they’re personally marketing and adopting in the same capacity,” MacAlpine said. “So we focused our efforts more on integration of the platforms, technology solutions, digitization and automation.”
Earlier this year, CI integrated its Canadian wealth business under the joint management of Sean Etherington, president of CI Assante, and Chris Enright, president and managing director, Aligned Capital Partners, who both added the title of co-heads of Canadian wealth management.
During the conference call, MacAlpine referred to Etherington and Enright as “former” presidents of Assante and Aligned. But Murray Oxby, vice-president of corporate communications, confirmed in an email to Investment Executive that the two executives retained their previous titles as part of their expanded roles, and “there would be no changes to the existing Assante or Aligned advisor business models, which will continue to operate as is.”
MacAlpine said its wealth management businesses represented “an inherent level of stability” during the recent market turmoil relative to its asset management business, which is more sensitive to market volatility. In April, CI Financial posted $1.3 billion in asset management outflows.
“We absolutely experience the impacts of the market both up and down [in wealth management], but as markets strengthen or worsen, it’s not typically a catalyst for people to switch their advisors,” MacAlpine said. When markets rebound, however, “you get more positive operating leverage in asset management on the upside as people may put money to work a little bit faster.”
MacAlpine said that in Q1, the firm shifted its capital allocation strategy toward paying down debt and ramping up share repurchases, as opposed to acquisitions. In the first quarter, CI announced two acquisitions of U.S. registered investment advisors: Corient Capital Partners and Eaton Vance Investment Counsel. Last year, the firm acquired 15 U.S. RIAs.
“We’ve absolutely slowed down the pace of the acquisitions and focused on integrating,” MacAlpine said.
Earlier this week, CI Financial announced it had applied for a charter for a South Dakota trust company, CI Trust. Once chartered, CI Trust would offer administrative trust services through the firm’s CI Private Wealth business in the U.S.
When asked if Canadian advisors and clients would be able to access U.S. trust services through the new company, Oxby said that “initially, trust services will be limited to U.S. residents and U.S. assets.”
CI Financial’s U.S. RIAs and CI’s Canadian advisory firms have referral relationships to provide cross-border advisory services to their respective clients, Oxby added.