Masters of Money

August 25, 2010

By Bill Virgin

Did you have as much fun in your business in 2009 as
Washingtons money managers did in theirs?

We hope not. News of the markets recovery in 2009 obscured
the less happy developmentsfirms pulling out of the state or closing up shop,
clients pulling out money, fears that the rebound would be short lived.

Assets under management fell 15 percent from mid-December
2008 to Feb. 11, 2010, according to the annual survey compiled by RAH
Financial
, the Covington-based executive search firm for financial-services
companies.

Roger Hendrix, the firms president and CEO, recalls meeting
with some money managers early in 2009 who were interested in selling or
merging their firms out of fear and desperation. Those emotions
subsidedsomewhatlater in the year as the markets improved and as managers
realized the payouts, on a percentage of earnings, would be less than half of
selling prices in the boom years.

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Not that theyre feeling comfortable. Many still are very
fearful of the next shoe to drop in the market, i.e., the feared double
bottom, Hendrix says. Many are still sitting on a pile of cash, with some
having 50 percent or more of their [assets under management] in cash, waiting
for the buying signals, protecting whats left of some investors assets who
experienced a 30-percent-plus drop during 2008.

It has been very difficult for even the most savvy of biz
dev professionals to win new [high net worth] accounts, as most investors still
havent recovered from the 08-09 market turmoil, he adds. Its tough
sledding when you are attempting to win new business when your average account
returns are negative on a 1-, 3- and 5-year basis.

But it wasnt bad news for everyone. Here are snapshots of
three firms that bucked the trend and increased their rankings and the
investment assets theyre managing.