breeden should sell the old olde for pennies on the dollar?I think olde was sold for 950 million plus,what is the shareholders return on investment?This division is a black eye for us.I have no interest in tax clients doing business with them.no upside for tax pro<s
I am so sorry that it has taken so long to respond to your post, I have been a little busy, but I would like to bring up a few last points.
"well in my experience, you dont borrow $ from a creditor using a business unit as "collateral" per se. Lending decisions would be made on other, broader, more relevant data points."
I am not sure what your expierence tells you, but the only broader, more relevant data point is an entities ablity to repay borrowed money.
"The logic you suggest would be odd. I'm going to retain a money-losing division, so that I will be able to borrow more money?"
Well, my logic is not odd, it may seem that way because your premise is wrong. A division that has positive cash flow, revenue growing at 11% yoy, profits growing at 21% yoy, elimination of noncash charges, and the "special dividends" paid from HRBFA to HRB this becomes an asset with enhanced value for a company in the midst of a turn around.
<<I'm almost 100% positive that the HRBFA account cash balances are deposited @ HRB bank.>>
I am 100% positive, because it happened to me. I even received a letter welcoming me to the Bank. I called them to inquire about it, since I hadn't opened a "bank account" with them. They either said (or implied) that that's where all the cash went.
I'm almost 100% positive that the HRBFA account cash balances are deposited @ HRB bank.
My preferred partner told me about a year ago that HRBFA's cash deposits were moving there.
BUT - I don't think Bank is holding their money market accounts.
I'm a big believer that if a job is worth doing, it's worth doing well. Bank and HRBFA will NEVER achieve their true potential without significant additional spending (aggressive rebranding, in the case of HRBFA). They're never going to be a "job done well", so they should be dropped. Immediately. Money is too tight at this firm to screw around.
I think her point was more about prestige.
HRB Tax has no "snob appeal". By contrast, big investment money flows to the firms that do, and that have high expertise capabilities.
i.e. there's not enough synergy between Tax>>HRBFA.
Your colleague isn't very adept at making analogies. Taxes->HRBFA isnt the same as cheap food->expensive food.
A better analogy would be boxed wine. Something that you dont really even like the taste of, but with enough of it, you forget about how awful it really is.
Stifel Nicholas, RBC Dain, Baird, Edward Jones, Fidelity branch locations and the likes. Banks too. Some could go independent, or maybe go work for a mutual fund/annuity company as an outside sales rep.
Have to share this one:
Was talking with another Tax Pro in the office the other day about HRBFA. She said Ernst's original concept about getting into investment services was just like the CEO of McDonalds standing up at a board meeting and saying, "You know what McDonalds really needs? Steak and lobster!".
Where would said FAs go work? I dont think any wirehouses even recruit experienced FAs with T12<250K. Im not sure there would be significant signing bonuses awaiting them, else they prob would have jumped the hrbfa ship already dont ya think
Semantics aside, HRBFA does not have the sort of clientele, invested in the sort of fee-based products, that would best position a broker to weather a US economic downturn.
How many trust funds does HRBFA manage? How many foundation accounts are oversaw? How my estate plans have been drawn up the past year? How many SMAs does it manage? How many hedging strategies does it manage for UNHW clients?
HRBFA is absolutely a full service brokerage. Anyone that calls them discount needs to check their facts.
Based on my experience of the competition, they have an excellent product line up.
The major issue is that the only real way anyone is going to hear about HRBFA is if TPs buy-in and talk to clients at the desk >>> Ernst's original vision.
Well, guess what? HRB Tax is alligned with middle-to-lower America, so that's who hears about HRBFA. (Assuming the TP even understands what they do and/or wishes to work with them...a stretch, most of you will agree). Nobody - repeat, NOBODY, can be a full-service broker to middle/lower America. It's impossible.
ALL CAPS (BECAUSE EVEN IF THERE'S A REMOTE CHANCE AN HRB DIRECTOR IS READING THIS, IT'S WORTH IT) HRBFA WILL NEVER BE ABLE TO UTILIZE SHAREHOLDER EQUITY BETTER THAN A TAX DIVISION. TAX, MY GOOD PEOPLE, IS A CASH COW. DON'T SCREW AROUND - SELL HRBFA, AND DO IT QUICK.
I'm positive all those reps would happily take a bonus check for hiring on with a new firm, with a stronger investment management reputation. It's a win for HRBFA, win for HRB, and win for shareholders.
(Win-win-win for all fans of "the Office").