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LPL Reports $1.13 Trillion in Advisory and Brokerage Assets in 3Q21

LPL Financial Holdings Inc. (Nasdaq: LPLA), the parent of LPL Financial LLC – the nation’s largest independent broker-dealer, reported that total advisory and brokerage assets increased 40 percent year-over-year to $1.13 trillion.

LPL Financial Holdings Inc. (Nasdaq: LPLA), the parent of LPL Financial LLC – the nation’s largest independent broker-dealer, reported that total advisory and brokerage assets increased 40 percent year-over-year to $1.13 trillion, according to its third quarter 2021 financial results.

Advisory assets increased 46 percent year-over-year to $594 billion. Advisory assets as a percentage of total assets increased to 52.4 percent, up from 50.1 percent a year ago. Brokerage assets increased 33 percent year-over-year to $538.6 billion.

Advisor count was 19,627, up 513 sequentially and 2,459 year-over-year.

Total organic net new assets were $27 billion, translating to 10 percent annualized growth Organic net new advisory and brokerage assets were $21 billion and $6 billion, respectively.

Acquired net new assets were $2.3 billion, of which $0.6 billion were advisory and $1.7 billion were brokerage.

Recruited assets were $13 billion, up by 24 percent from a year ago. Recruited assets over the trailing 12 months were $83 billion, more than double a year ago.

LPL completed onboarding of $71 billion of Waddell & Reed client assets in the third quarter, translating to retention of approximately 99 percent. The firm onboarded $4.5 billion of brokerage assets from M&T Bank in the quarter, which substantially completes the onboarding of M&T’s approximately $22 billion total assets.

In addition, CUNA Brokerage Services signed an agreement to join LPL’s platform. The firm supports more than 500 advisors serving approximately $36 billion in brokerage and advisory assets.

“We delivered another quarter of strong results in Q3”, said Matt Audette, chief financial officer. “We drove assets to new highs and recorded another quarter of double-digit organic growth. With the onboarding of Waddell & Reed, BMO, and M&T complete, we are continuing to help advisors acclimate and leverage our platform and capabilities, while also preparing to onboard CUNA next year.”

Net income was $103 million, translating to diluted earnings per share of $1.26. This compares with $104 million, or $1.29 per share, in the third quarter of 2020 and $119 million, or $1.46 per share, in the prior quarter.

Gross profit was $631 million during the third quarter of 2021, compared to $506 million for the same period last year, and $602 million during the second quarter of 2021.

Core general and administrative expenses increased 19 percent year-over-year to $271 million.

EBITDA increased 10 percent year-over-year to $225 million, and EBITDA as a percentage of gross profit was 36 percent. During the same period last year, EBITDA totaled nearly $205 million, and in the previous quarter totaled $243 million.

Total client cash balances were $51 billion, an increase of $2 billion sequentially. As a percentage of total assets, client cash balances were 4.5 percent.

LPL supports more than 19,000 financial advisors, 800 institution-based investment programs and 450 independent RIA firms nationwide.

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