FINRA Registered Firms/Reps Continue to Decline

The number of brokers and brokerage firms continued to decline in 2017, according to statistics released by FINRA last week. There were 3,726 FINRA-registered firms last year, down from 3,835 in 2016. The number of registered representatives fell last year as well, dropping to 630,132 in 2017 from 635,902 in 2016.

The highest toll of registered representatives occurred in 2007, when approximately 68,862 registered representatives entered the industry. Since then, new entrants haven’t surpassed 50,000 in any given year. The greatest loss occurred in 2009, when 72,564 registered representatives left the industry. The total number of FINRA registered firms has also been steadily declining over the years. In 2013, 4,146 firms attained registration, compared to the 3,726 in 2017.

The report also illustrates adviser and firm breakdowns by type of registration. In 2017, 55% of FINRA-registered representatives were with broker-dealers only, while 45% were dual representatives. For the entire securities industry, 50% were broker-dealers only, 41% were dual representatives and 8% were investment adviser only.

The number of firms registered as investment advisers has risen from 24,147 in 2008 to 29,599 in 2017, while the number registered solely as brokerage firms has declined during that same period from 3,969 to 3,132.

The following five states, according to the report, have the most firms and branches: 1.) California, 2.) New York, 3.) Florida, 4.) Texas and 5.) Illinois. The top five marketing methods include: 1.) web information – public access, 2.) fund specific information sheets, 3.) flyers and other hand delivered materials, 4.) brochures, pamphlets and catalogs and 5.) periodic and other performance reports.

To read the complete FINRA industry snapshot, click here.