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Raymond James Financial CEO Paul Reilly on the outlook for financials and the impact of regulations.
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Raymond James Financial announcing its fiscal third quarter earnings.
And -- -- to beat the street expectations and earnings per share and revenue the report comes on the heels of Goldman Sachs is surprisingly do -- earnings are yesterday with the usually dominant Wall Street firms saying stifling new regulations of dwindling trading opportunities.
Took a toll.
I'm not just some of the financial industry will are they speaking fairly for everybody is Wall Street's future really this bleak or as the management of certain companies strong enough.
That they can overcome anything for that we welcome Paul -- he's the CEO Raymond James Financial.
Joining -- exclusively.
In claimants money -- Paul -- nice numbers -- certainly.
When you hear the complaints from Goldman Sachs and company about regulation being onerous.
You guys just beat on both the revenue and -- -- minute 59 cents per share not to mention 850 million for your revenue looking very good here for financial services.
Can you system and do well in any atmosphere no matter what's thrown at you.
-- on any atmosphere of I think any reasonable atmosphere that no doubt the regulation is putting pressure on everyone.
And it has affected us less than most companies because we tend to have been very conservative.
Highly capitalized and so we weren't hit in the downturn in fact this quarter of profitability -- 94 consecutive quarter profitability.
Nine.
You see both good times and bad but let me push you a little bit on the regulation issue because tomorrow.
Is of course the one year anniversary of Dodd-Frank have you found it -- dining or are you able to deal with that enough that you feel.
You can get decent profits through.
I think we get decent profits through it I guess the question is the unknown.
Is that so many the rules are still unwritten.
That people a lot of the businesses are competitors that are more affected by don't know what to do.
And one yet you don't -- -- risk cap or put to work if you're gonna have to undo it so it's both.
The mass of the regulation which we believe is too much too we think there's too much coming from and it's more regulation and rules and it's needed.
And it's also the uncertainty about what are they gonna be and what do we do with the businesses that we have today but.
We just happen to be in a very good position where they impact this much less than most funds.
Well how do you adjusted where have you seen the biggest impact.
Well the biggest impact really so far has been kind of -- advantage we've had people.
Moved to us during the downturn during this -- certain period of time so.
If you look at the regulations so far what's been written and only a handful the rules have really been written.
There is a lot of impact.
But there is impact coming that's uncertain two officers impact around fiduciary standard how.
Different types of advisors will be regulated right the SEC is proposing rules and department of labor's frozen rules under different.
So that does create uncertainty on moving Ford on a number of fraud.
It's while the regulatory oversight of the financial industry seems to obviously be increasing and and we hear complaints all the time let me play devil's advocate and ask you.
Isn't this a fair price to pay to help protect from.
Any kind of situation that's similar to what we saw just a couple of years ago nobody wants to see that again.
And to that and can't we protect against that I mean bubbles form no matter what happens but.
Are the regulations that we really actually -- need after all of this.
Well certainly I think that you know there's a school of thought that the regulators were in place that -- enforced rules and the fact.
I think you could have gotten most of the benefit by just imposing.
Adequate capital guidelines in the historic capital guidelines have been used in our industry and and some regulation on over some of the businesses but I think that detail on depth.
It's gotten down to including things like interchange fees with the prices are being set by the government is an -- At the end of June Raymond James settle charges with the SEC alleging that you -- the company have purposely misled clients when it came to things like for example certain auction rate securities leading up to the credit crisis.
Can you say that this ends the litigation that you guys will face to feel that your path is -- -- clear moving forward.
Yeah and fact.
You know we were late to settle for one reason we have we believe we have the best industry practices we've disclosed to our clients that auctions could fail -- we put it on their confirmations but.
At the end of the day we wanted to get it behind us and we want to get our clients' liquidity so we settled just to move forward but that's that's the end of the auction rate story for us.
For Ricoh though Paula just wanted to ask you we're hearing about layoffs at Goldman Sachs possibly Morgan Stanley argue laying off people to do expect to see that kind of shedding of jobs.
Well we had more people the end of 09 in the beginning we had more people the end of 2010 in the beginning we're still hiring and so we see a tremendous growth opportunity.
Partly because the consolidation of the industry in the downturn.
Has left a big hole in the middle from the big firms to the old regional firms so we see a major growth opportunity for Raymond James.
Paul -- CEO of Raymond James Financial thank you so much for joining us to give us this perspective we appreciate it.
