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Non-Tech : Goldman Sachs Group Inc. NYSE:GS

GS 792.91

+0.3%

Nov 5 3:59 PM EST

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From: Don Green	5/5/2006 7:07:20 PM
	of 411

Morgan Stanley Luring Brokers With Bonuses Morgan Stanley is offering high-producing financial advisors a bonus of up to 200 percent of their gross revenue over the past 12 months if they jump ship from competitors to join the firm. Morgan Stanley has offered the deal — a combination of upfront cash and additional components paid over the next several years based on the recruit's performance — twice in recent months, said people familiar with the package. The terms highlight just how intense the competition has become as brokerage houses scramble to recruit high-producing advisors with significant client assets. UBS AG is offering a similar bonus this year, and brokerage firms like Merrill Lynch & Co. and Wachovia Corp. unit Wachovia Securities could feel compelled to make similarly generous offers. "This puts pressure on others to do something to get slightly more aggressive," said Andy Tasnady, a compensation consultant specializing in the financial sector. Wall Street firms have become more aggressive in luring high-producing advisors as they switch toward a business based on collecting fees for assets under management and away from the more volatile model of relying on revenue from per-trade commissions. Morgan Stanley has more than 9,000 brokers. "Our compensation packages are competitive within the industry and determined on a case-by-case basis," Morgan Stanley spokeswoman Erica Platt said. The firm is expected to continue offering the deal to experienced financial advisors who have produced more than $1 million in commissions and fees over the past year. "Money is the best inducement for these kind of people to come aboard to Morgan Stanley," said Howard Diamond, an executive recruiter dealing with financial services companies. "It's a terrific opportunity to harness quality financial advisors."

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