Wealth management firms know that Rob Babek, a partner in charge of accounting firm Marcum’s Century City office, keeps the books for some of the richest families in Los Angeles.

Which is why at least twice a week, Babek gets cold calls from brokers and investment advisers. They’re pretending they can help him drum up business, but really they’re looking for an in with his wealthy clientele.

“They always start off with the same line: ‘I could refer you a lot of business.’ But in reality, it’s the other way around,” Babek said. “The competition is brutal.”

And it’s getting more so. In the past two years, out-of-town firms have been buying local wealth management shops or opening their first West Coast offices here. New shops are cropping up, too, as money managers leave big firms and start their own practices.

With a growing economy and a booming stock market, the fortunes of wealthy families are on the rise. And that’s leading to more competition to manage their money, especially for the richest of the rich, said Paul Miller, managing director in the new Westwood office of Irvine wealth manager First Foundation Advisors.

“It’s a pyramid,” he said. “As you go up the pyramid, the number of clients gets smaller and the competition gets fierce. Clients have a lot of options.”

The biggest recent deal was the October acquisition of Century City’s Bel Air Investment Advisors by Montreal asset management firm Fiera Capital Corp. Another noteworthy local deal was the December 2012 acquisition of Luminous Capital Holdings, also in Century City, by San Francisco lender First Republic Bank. (See page 32).

Luminous and Bel Air each manages more than $5 billion in assets, making them two of the biggest wealth managers in Los Angeles.

City National Bank, the biggest local commercial bank, has offered wealth management for years, but it recently expanded its offerings, launching subsidiary City National Rochdale in September. It’s the combination of City National Asset Management and Rochdale Investment Management, a New York firm the bank acquired in 2012.

The number of wealth management firms is growing at a remarkable pace.

Last year, 65 new wealth management firms in California registered as investment advisers with the Securities and Exchange Commission – up from 57 in 2012 and 42 in 2011. And the pace continues to quicken: Already this year, 23 new firms registered.

Westwood stock brokerage and investment bank B. Riley & Co. late last year created B. Riley Asset Management, a new affiliate that will offer investment products and advisory services for wealthy clients. Steve Lockshin, who founded Convergent Wealth Advisors, now owned by City National, last month started Century City wealth management firm AdvicePeriod. (See page 30.)

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