Charlotte, N.C.-based Wachovia Corp. may have taken n $8.7 billion write-off, mainly mortgage-related bad debt inherited through the acquisition two years ago of California-based Golden West Financial. But the jobs at the financial company's Wachovia Securities brokerage arm -- formerly headquartered in Richmond -- are safe.
Wachovia Securities CEO Danny Ludeman, who spent most of his brokerage/investment banking career in Richmond, said that St. Louis employees were insulated from the woes of the parent company. “Despite the challenges faced throughout the holding company, the brokerages are doing great,” he told the St. Louis Business Journal.
Wachovia’s retail brokerage services posted a $316 million profit on $2.3 billion in revenue in the second quarter.
Bacon’s bottom line: A significant number of Richmond employees of Wachovia Securities chose to leave their jobs rather follow the company when it relocated the H.Q. to St. Louis. The article provides some hints of how large those numbers might have been.
About 145 people in St. Louis were laid off when the merger of Wachovia Securities and St. Louis-based AG Edwards went through last year, the article states. Presumably, those jobs represented cuts to redundant executive and back-office positions, the kind of cuts any company makes when it merges two large companies. Now, reports the Business Journal, the company plans to "add 500 to 1,000 jobs to its existing St. Louis work force of approximately 4,800."
Even though the brokerage is profitable, it is hard to image that business conditions are so sweet that the company is embarking upon an expansion-related hiring binge -- especially with the parent company choking on an $8.7-billion write-down and laying off thousands elsewhere. Is it possible that the hires are meant to fill vacancies created when the Richmond employees who formerly occupied them refused to relocate to St. Louis?
Anecdotally, we know that a number of Wachovia veterans have joined local financial firms. R’Biz has reported that at least one investment advisory firm, Riverfront Capital, was created by Wachovia Securities refugees. Last week, Boxwood Partners, a private equity group, announced that it had hired Bryan Burden, an associate in the investment banking group at Wachovia Securities. Presumably, there are many more instances of individual hires that never make it into press releases.
I'm my surmise is right, that's pretty cool: Some 500 to 1,000 Wachovia Securities employees quit their jobs rather than leave Richmond.