Raymond James Financial Reports 3rd Quarter Fiscal 2017 Results

Raymond James Financial, Inc. (NYSE: RJF) has reported record net revenues of$1.62 billion and record net income of $183.4 million for the fiscal third quarter ended June 30, 2017. For the first nine months of fiscal 2017, net revenues of $4.68 billion increased 19 percent, net income of $442.7 million increased 24 percent, and adjusted net income of $550.8 million increased 47 percent compared to the first nine months of fiscal 2016.

“Record quarterly results were driven by record revenues in the Private Client Group segment, Asset Management segment, and Raymond James Bank,” said Chairman and CEO Paul Reilly. “Our continued success in recruiting and retaining financial advisers has led to records for client assets under administration, financial assets under management, and loan balances at Raymond James Bank.”

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Black Monday

On 19 October 1987, the stock markets experienced a dramatic plunge that prompted many firms to shut down their trading desks and turn off their phones to minimize internal losses. Raymond James refused to do the same. Our desks stayed open to help meet clients’ needs, resulting in our first and only unprofitable quarter since the firm went public in 1983.

Who was Raymond James?

The Raymond in our name is actually from Edward Raymond, owner of a 15-employee mutual fund sales group, Raymond and Associates, along Florida’s west coast. He sold his company to Bob James on 15 July 1964, on condition that the surviving firm be called Raymond, James & Associates.

Three days after the sale, Ed Raymond was involved in a near-fatal automobile accident and never joined the firm.

Nonetheless, even after Raymond had passed away, Bob James insisted that his name remain on the door – ahead of James’ own. That was a promise he made to Ed Raymond three days before the accident, and Bob James was a man who kept his promises.

Bear Market of 1974

The severe bear market of 1974 threatened the existence of Raymond James, which was bleeding capital by the day. Tom James, his father and other leaders took extreme measures to keep the firm afloat, slashing costs, foregoing paychecks and even attempting to sell the firm for just enough capital to protect client assets and retain as many associates as possible. The story could have ended very differently if not for a sharp upturn and continued rebound in the stock markets late in the year.
This “fortunate near-death experience” (as Tom calls it) permanently marked his psyche, and has influenced our firm’s character and culture since, solidifying the conservative nature that emphasizes a determined focus on the long term – both for clients and the firm.

Taking Raymond James Public

When consideration was being given to taking Raymond James public, Tom James penned a letter to shareholders (largely employees at the time).
He wrote:

” … the public offering should be considered as a statement of our independence. While this is a psychological rather than an economic rationale, it is nonetheless very important. We have asserted for some time that we are not interested in becoming a small part of a very large corporation. That assertion results mainly from the inclinations of management rather than the economic benefits associated with either alternative. The public stock offering affords us the opportunity to enjoy a little bit of the best of both worlds. While shareholders will be given liquidity at fair market value, we will still have the ability to control our own destiny.”

After 40+ years of Tom’s leadership, upon becoming CEO, Paul Reilly was often questioned about whether the company might ultimately surrender its cherished independence and be acquired by some larger entity. His response: “Not while I’m around.” It’s a theme that continues today.