First Republic Private Wealth Management Review
First Republic Private Wealth Management is a financial advisor firm based in San Francisco, California. Acquired by First Republic Bank in 1999, the firm has grown to employ nearly 300 advisors and hold roughly $78 billion in assets under management. The firm offers investment management services, financial planning services and insurance to its clients.
First Republic Private Wealth Management generally requires a $7,500 annual fee for investment management services, and its online investment management platform requires a minimum account size of $10,000. The firm offers services to individuals, trusts, pensions, defined contribution plans, profit-sharing plans, banks, corporations and other business entities.
First Republic Private Wealth Management Background
First Republic Private Wealth Management, also known as First Republic Investment Management or FRIM, was formed in 1999 when it became a wholly owned subsidiary of First Republic Bank, a commercial bank founded in 1985. The firm is led by President Robert L. Thornton, Executive Vice Presidents Susie Cranston and Brian Riley and Chief Investment Officer Chris Wolfe. First Republic Private Wealth Management has roughly 11,000 clients and $78 billion in assets under management.
What Types of Clients Does First Republic Private Wealth Management Accept?
First Republic Private Wealth Management works with approximately 12,000 clients, including individuals, high-net-worth individuals, pooled investment vehicles, pension and profit-sharing plans, charitable organizations, government entities and corporations. The largest chunk of the firm’s clients are 7,329 high-net-worth individuals.
First Republic Private Wealth Management Minimum Account Sizes
The firm doesn’t explicitly have a minimum account size, but it generally charges a minimum annual fee of $7,500 for investment management services. To meet this fee minimum and also follow the firm’s typical fee schedule (more on that below), you would need an account size of at least $500,000. If you wish to use the firm’s online investment management platform, Eagle Invest, you’ll need an account size of at least $10,000.
Services Offered by First Republic Private Wealth Management
First Republic Private Wealth Management offers a wide range of services to its clients, including the following:
- Investment management
- Balanced portfolio management
- Fixed income management
- Eagle Invest
- Financial planning
- Endowment management
- Brokerage services
- Trust services
- Insurance services.
You can choose to opt for investment management services with one of First Republic’s financial advisors or with the firm’s online investment platform, Eagle Invest. Eagle Invest is a robo-advisor with lower fees and a lower account minmium than the firm's traditional investment management services.
First Republic Private Wealth Management Investment Philosophy
First Republic Private Wealth Management draws from a number of different investment strategies in order to tailor an approach that meets each individual client’s needs. When determining the proper allocation of assets in your account, the firm relies on your risk tolerance, time horizon and goals, as well as the expertise of its in-house asset allocation committee. The firm also conducts proprietary research on all kinds of securities across asset classes, and it uses that research along with more wide-ranging macroeconomic forecasts to determine the best value for your portfolio.
Fees Under First Republic Private Wealth Management
For investment management services, First Republic generally charges a fee based on a percentage of your assets under management. This fee is paid quarterly in advance, and it doesn’t include things like brokerage fees, transaction fees or other extraneous costs that you may incur throughout the course of investing. The exact rate you pay will depend on two different schedules: one for any fixed income investments and one for everything else. The fixed income schedule is as follows:
|Assets Under Management||Fee Rate|
|$2 - $10,000,000||0.40%|
|$10,000,000 - $25,000,000||0.35%|
|$25,000,000 and up||Negotiable|
The following schedule applies to equity and balanced portfolios:
|Assets Under Management||Fee Rate|
|$2,000,000 - $5,000,000||1.25%|
|$5,000,000 - $10,000,000||0.75%|
|$10,000,000 - $25,000,000||0.60%|
|$25,000,000 and up||Negotiable|
If you choose to use First Republic’s online investment platform, Eagle Invest, you’ll pay a flat fee of 0.40% for all assets under management. Financial planning fees are typically fixed and can be negotiable depending on the scope of services offered and the complexity of your account. Typically, you will pay these fees in advance, and if for some reason you part ways before you receive your plan, you can request a refund. First Republic Private Wealth Management doesn’t charge performance-based fees except for in the case of two funds that are closed to new investors.
The below table shows how First Republic Private Wealth Management's non-fixed income fees compare. Remember that these are only estimates and actual fees may vary.
|Estimated Fee Comparison*|
|Your Assets||First Republic Private Wealth Management||National Median Advisory Fees**|
|$1MM||$15,000||$8,500 - $10,000|
|$5MM||$67,500||$25,000 - $32,500|
|*Fee estimates only consider the maximum base fees for the services each firm provides. You may also pay manager fees and other fees, which can vary in amount. **All figures are based on median fee levels according to Bob Veres' 2017 Planning Profession Fee Survey. The above estimates solely take into account AUM-only fees. Total costs will likely be higher due to additional expenses.|
What to Watch Out For
First Republic Private Wealth Management typically uses an affiliate, First Republic Securities Company (FRSC) for broker-dealer services, and FRSC receives compensation for these services. For instance, if a Private Wealth Management advisor recommends investing in a mutual fund, that would involve using FRSC, and FRSC would receive a commission and fees for that investment. This incentivizes both firms to recommend funds that generate these fees, and that incentive creates a potential conflict of interest.
Several First Republic Private Wealth Management advisors are also licensed life insurance agents, and these advisors receive compensation from First Republic Bank’s insurance division, Grand Eagle, for the sale of insurance products. This compensation incentivizes advisors to recommend insurance products to their clients, and such an incentive also creates a potential conflict of interest.
Despite these conflicts, First Republic Private Wealth Management is bound by fiduciary duty, which means that it is legally obligated to act in its clients' best interests in all matters.
First Republic Private Wealth Management has two disclosures on record with the Securities and Exchange Commission (SEC). One involved an advisory affiliate, and the other involved the SEC's finding that at times between January 2014 and July 2018, the firm purchased, recommended or held for clients mutual fund share classes that paid 12b-1 fees to the firm or affiliated broker-dealer when clients were eligible for share classes of the same funds that were lower cost. The firm agreed to a censure and cease-and-desist order and paid almost $1 million in disgorgement and pre-judgment interest.
Opening an Account With First Republic Private Wealth Management
To become a client of First Republic, you can start the process in a few different ways. You can head to the firm’s website and fill out the contact form with your name, contact info and any other pertinent details, then an advisor will reach out to you to get the ball rolling. You can also call the firm’s toll-free number at (888) 408-0288 to schedule an initial consultation. If you prefer, you can also visit your nearest office to make an appointment.
Where Is First Republic Private Wealth Management Located?
First Republic has private wealth management advisors located across the country in Boston; Wilmington, Delaware; Greenwich, Connecticut; Honolulu; Los Angeles; New York; Newport Beach, California; Palm Beach, Florida; Portland, Oregon; San Diego; San Francisco; Santa Barbara, California, Silicon Valley, California; and Vancouver, Washington. The bank’s headquarters are in San Francisco.
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