As I prepare this letter, D.A. Davidson is celebrating its 85th year in business. It’s inspiring to consider the commitment, perseverance and ingenuity that helped the firm reach this remarkable milestone, despite headwinds through the years. Today, with our anniversary coinciding with a global health crisis, I believe it is more important than ever to consider the lessons of such resilience.
In this year of systemic dislocations, the people of D.A. Davidson have been the foundation of our firm’s success. From the technology team moving us seamlessly to a work-from-home environment to managers creating innovative ways of ensuring employees remain engaged, our colleagues have met 2020’s challenges with strength, tenacity and grace. Most importantly, they have continued to serve our clients and serve them well. In a year that called for bold ideas and frequent reinvention, I could not be more proud of our associates. To me, the year has provided great evidence of the benefits of our employee-ownership structure, which rewards the passion and commitment of our team.
Similarly, our firm has had the right approach. Our strategy includes maintaining a conservative balance sheet, which allowed us to enter the year with solid financial footing and continue expanding. By the end of 2020, we had added professionals, opened offices in new locations and grown the firm’s assets under management and administration to a record $52.9 billion. We never stopped investing in our people, resources, technology and training — a mix that will fuel further growth in coming years.
The year has reinforced our belief in the importance of our diversified business model. While some areas faced challenges, our Fixed Income Capital Markets group excelled in the low interest rate environment, which increased client appetite for public finance refunding as well as heightened activity within our secondary municipal, taxable and CD businesses. With our team taking advantage of market conditions, and hiring significant numbers of professionals, FICM achieved records in revenues and pre-tax earnings.
Our Asset Management and Trust team also reached new highs in pre-tax earnings — profiting from previous years of expansion and reinvestments, including a focus on using robotic automation to update and streamline trust accounting processes.
While markets trended upward, they also have been uneven. Both our Wealth Management and Equity Capital Markets groups ended 2020 with strong performances. These teams — for whom relationships are critical — developed creative ways to overcome social distancing obstacles so they could provide important guidance to clients during uncertain times. Additionally, both Wealth Management and Equity Capital Markets maintained their growth trajectories by adding experienced professionals in strategic markets and sectors. ECM’s successes were fueled in large part by the year’s focus on the technology sector, with significant new hires and transactions as a result. Growth within our Wealth Management team was slower; however, we expect our investments in both of these teams to yield significant dividends, and stand ready to welcome more talent in years to come.
Complementing our solid business performance were many less tangible accomplishments. Key among them has been our enhanced work as One Davidson, a whole-team approach that we believe strengthens our enterprise with enhanced idea-sharing, decision-making and cross-discipline cooperation. More than ever, 2020 highlighted the importance of working together to unlock innovation and develop transactions that transcend business lines. We also have taken extensive steps to support and engage all employees, including increased communications and Zoom calls for employees and their families. Additionally, we are supporting employees with a range of assistance and accommodations, from staggering shifts so parents can care for children at home to maximizing office hygiene measures to keep our colleagues safe.
Our firm’s managers have felt it especially vital to give back to our communities in 2020. We provided significant financial donations and continued D.A. Davidson Day, our annual volunteer initiative providing hands-on assistance to hundreds of nonprofits. I like to say that giving back is not just the right thing to do; it’s the way we do business.
In uncertain times, it is important to note that some things do not change. D.A. Davidson has been working on behalf of our clients since 1935, providing exceptional service with a personal touch. Throughout our history, we have attracted exceptional professionals whose commitment is clear and whose passion is unrivaled. As I
close this letter, I would like to thank our employees for their resilience and thank our clients for their loyalty. Together, we will forge ahead toward a brighter future. I look forward to doing so.
JAMES P. KERR
Chairman and Chief Executive Officer