Citi's Smith Barney has joined Wall Street brokerage firms Merrill Lynch and Morgan Stanley by cutting payments to lower producing advisors starting next year, the company confirmed.

Smith Barney reps with lower than $400,000 in yearly production will receive two to four percentage points less, according to the firm’s 2009 Financial Advisor Compensation Plan released to FAs.

Smith Barney currently employs around 15,500 financial advisors in over 800 offices globally.

The plan is in line with rival firms Merrill Lynch and Morgan Stanley – both of which have already announced revised compensation packages cutting lower producing advisors out of revenue sharing deals.

Brokers with nine years or more in the industry who produce between $300,000 and $350,000 will get a 30 per cent payout at Smith Barney when previously they had been getting 37 per cent, according to the Citi document.

Similarly, Merrill Lynch brokers with six or more years’ service will have to produce $300,000 to be considered for inclusion on the firm’s payment grid, according to press reports citing the Merrill announcement late last year.

Reps at Merrill producing less than $300,000 will get a flat 25 per cent payout starting in January next year.

The Citi compensation plan also offered an additional loan programme for advisors who earned more than $400,000 gross revenue in 2008.

Under the Citi loan programme, eligible FAs will be given the option of taking out a six-year interest free loan from the firm commensurate with production levels and time spent with the firm.