And it sees spate of hires, rather than ointment, as an appropriate remedy. Morgan Stanley Smith Barney (MSSB), a joint venture between the retail brokerages of Morgan Stanley and Citigroup, plans to add advisors in Australia, according to MSSB chairman James Gorman.

The tie-in, which as announced in January 2009 and completed about three weeks ago, includes the two firms' private-client arms in the U.S., Australia and the U.K. (where Citi does business through Quilter, a financial-planning firm it bought from Morgan Stanley in 2007.)

Petri dish

The combination of Morgan Stanley's Australian private-client business and Citi's Smith Barney Australia is a "tremendous platform for growth," Gorman, who is co-president of Morgan Stanley in addition to his role as chairman of MSSB, said in a broadcast interview with the Australian Broadcasting Corporation yesterday.

With this in mind, MSSB will be looking for "appropriate consolidation opportunities" in Australia over the next few years, said Gorman -- who was born and raised in Australia. "We would be looking to be an acquirer, either of individual's talent or of organizations to continue to grow."

In recent months UBS, Societe Generale and Goldman Sachs -- offshore banks that own or co-own large Australian private-client businesses -- have eliminated jobs in Australia.

Morgan Stanley paid $2.75 billion for a 51% stake in MSSB, which has about 18,500 financial advisors. The greater number of these advisors -- and a greater proportion of MSSB's assets under management -- came to the business from Smith Barney, whose corporate parent came close to a share-price collapse late in 2008 and again a few times this year.

Other Australian stuff

Zurich-based UBS' Australian private-client business has a new chief. Clark Morgan has replaced Liz Cacciottolo as CEO of UBS Wealth Management Australia.

Cacciottolo has been tapped to become a senior adviser to UBS Wealth Management businesses in the Swiss firm's Asian-Pacific region including those of Australia, Japan, Taiwan, China and India.

Melbourne-based Morgan, who has been with UBS since 2001, will report to UBS Asia-Pacific chief Graham Francis.

Cacciottolo ran UBS' U.K. private-client arm and headed its European equity-derivatives division before leading the bank's wealth-management operations in her native Australia.

In another wealth-management development in the Antipodes, National Australia Bank (NAB) plans to pay about $651 million for the Australian life-insurance operations and fee-based investment platform of Istanbul-based insurer Aviva.

By bolstering its standing in Australia's private insurance and turnkey investment-management markets, the deals is expected to improve NAB's chances of responding "to changes currently taking place in the wealth management market as a result of the financial crisis and regulatory reviews," according to the acquirer's CEO Cameron Clyne. -FWR

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