Horace Harding, who was married to one of Barney's six daughters. Barney retired in 1907 and was succeeded as senior partner of the firm by J. Harriman, Henry Frick, and William Rockefeller. Responding to the shifting of the nation's financial center from Philadelphia to New York City, Barney's firm purchased a seat on the New York Stock Exchange in 1898 and later opened a New York office. Smith, founded an investment banking firm bearing his name in 1892. Barney & Co., in Philadelphia in December 1873. He started his own brokerage and banking house, Charles D. Barney was a son-in-law of Jay Cooke, a banker who sold Treasury bonds to finance the Union cause during the Civil War but who later went bankrupt, precipitating the panic of 1873. was a subsidiary of the Investment Services division of Travelers Group Inc.Ĭharles D. It also embarked on an effort to become a world-class investment bank. The acquisition in 1993 of Shearson Lehman Brothers Holdings' retail brokerage and asset management businesses made the amalgamated firm, with an army of 11,000 financial consultants (brokers) and 495 branch offices, second only in the brokerage field to mighty Merrill Lynch. All Rights Reserved.From its unprepossessing beginnings in Philadelphia more than a century ago, Smith Barney has grown into a financial powerhouse. They just want to make sure their adviser isn't going anywhere."Ĭopyright ©2023 Dow Jones & Company, Inc. "I've spoken to people today who can't remember who owns Wachovia, or what happened to Washington Mutual. "To them, there have been so many of these 's just another bank deal," one broker said. (Morgan Stanley is paying Citigroup $2.5 billion to make up for the difference.) And while Morgan Stanley can ladder up its stake to 100% in five years Citigroup's 49% stake can only get smaller.As for clients, they seem largely unconcerned. Under terms of the deal, Morgan Stanley gets majority ownership of the joint venture-51%-though Morgan Stanley is contributing only 30% of the combined revenue and profit. "I never could find the guy at Citi to talk to."Citigroup, for its own part, hardly seems eager to manage Smith Barney any longer. "One of my clients wanted to refinance his mortgage," groused one broker. While there was pressure from Citigroup to sell other products, several brokers said there was very little guidance on how to do so. What could be worse than where we are now? Our stock is at five bucks." At the root of it all is the idea that Citigroup never really integrated Smith Barney into the rest of the bank, that Smith Barney has been a discrete fief, with its own loyalties and, most significantly, its own culture. It's just another layer of management we don't have or need. We had to kick money upstairs to them all the time, to the ivory tower, and now we're kicking it to ourselves. I've been through a lot of mergers and acquisitions and I know my job depends on me getting on the phone and calling people, not what some manager can do for me. They wanted us to sell mortgages and lending and all these other products-we're specialized. There was no benefit to being with Citi itself. The 'Citi' on your business card is an issue.""I've worked here since 1986," complained another broker. "The advisers at Smith Barney love it here and feel a bond with Smith Barney. Getty ImagesInstead, "We're excited about getting the Smith Barney name away from Citi," one broker said of the mood in his office of about 100 advisers. We expected them to voice worries about the coming joint venture with Morgan Stanley-about their jobs, their futures and their clients. Deal Journal has been speaking with Smith Barney brokers. It looks like there will be little love lost between Smith Barney brokers and their old parent, Citigroup.
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