The new chief executive of SWBC Investment Company, a hybrid RIA with $670 million in assets under management, has his eyes on the $1 billion threshold –and beyond—as he acends to his new role.
‘Within year one, we’re looking to raise net new business of around $500 million in new assets,’ said John Tuohy, who was named as CEO of San Antonio, Texas-based SWBC Investment Company and its sister broker-dealer, SWBC Investment Services, on Wednesday. ‘That would be through either acquisitions or new customers coming on board that we have in the pipeline.’
SWBC Investment Company and SWBC Investment Services are subsidiaries of SWBC, a comprehensive financial services company whose business lines include outsourced human resources management for small companies, life insurance and payment processing. That diversified business model gives SWBC Investment Company access to a broad universe of potential high net worth clients, Tuohy explained.
Despite launching the RIA in 2007, the firm not been focused on growing that side of the business, he added.
‘We have not pursued RIA growth at all. We’ve had this RIA set up for a while,’ he said. ‘The impetus around it really goes back to the history of SWBC, the parent company. We have 18 different business lines… We sit in a unique space where we have a lot of cross-pollination in between our different divisions. We have a division that is property management or professional employer organization (PEO). They’re in touch with high net worth individuals. We now have a solution to offer them for their wealth management or their asset management.’
Tuohy plans to staff up the RIA significantly. He’s in the market to hire several new analysts, portfolio managers – including an ESG portfolio manager – and a chief investment officer.
The firm’s current investment proposition consists of five core model portfolios which are overseen by its director of portfolio management, Josh Lynch. Two of the models primarily use individual equities, while three use a blend of mutual funds and ETFs. The firm also plans to add fixed-income capabilities to its models, Tuohy said.
The beefed-up investment team goes hand-in-hand with Tuohy’s growth goals for the business.
‘The big focus [for the company] will be on asset management and managing short-term cash and high net worth individual assets in our RIA,’ Tuohy said. ‘We’re also looking at small-to-medium sized RIAs for roll-ups.'
Tuohy replaces Kelly Tramontano, who departed SWBC at the end of May 2018 after 17 years in the CEO role. Tuohy had previously served as a managing director for the firm’s capital markets division, where he established its first-ever fixed-income trading desk. Before joining SWBC in January of 2015, Tuohy spent 13 years at Advisors Asset Management, where he was senior vice president and national sales leader.
SWBC oversees a combined $1.2 billion between its RIA and brokerage divisions.