Company: SFB
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000950170-25-027702
Chunk: 456

Company: STIFEL FINANCIAL CORP
Filing Date: 2025-02-26
Form: 10-K
Item: Item 7
Chunk 456
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 into investment commitments, lending commitments, and other commitments to extend credit for which we are unable to reasonably predict the timing of future payments. See Note 24 of the Notes to Consolidated Financial Statements for additional information.

The following table summarizes the activity related to our company’s note receivable from January 1, 2023 to December 31, 2024 (in thousands):

    2024

    2023

    Beginning balance – January 1
     
    $
    683,486

    $
    654,112

    Notes issued – organic growth

    91,786

    170,367

    Restricted cash issued

    67,251

    4,695

    Amortization

    (154,182
    )

    (145,227
    )

    Other

    (6,145
    )

    (461
    )

    Ending balance – December 31
     
    $
    682,196

    $
    683,486

We have paid $91.8 million in the form of upfront notes to financial advisors for transition pay during the year ended December 31, 2024. As we continue to take advantage of the opportunities created by market displacement and as competition for skilled professionals in the industry increases, we may decide to devote more significant resources to attracting and retaining qualified personnel. 

We utilize transition pay, principally in the form of upfront demand notes, to aid financial advisors, who have elected to join our firm, to supplement their lost compensation while transitioning their customers’ accounts to the Stifel platform. The initial value of the notes is determined primarily by the financial advisors’ trailing production and assets under management. These notes are generally forgiven over a five- to ten-year period based on production. The future estimated amortization expense of the upfront notes, assuming current-year production levels and static growth for the years ended December 31, 2025, 2026, 2027, 2028, 2029, and thereafter, is $162.6 million, $126.4 million, $107.7 million, $94.3 million, $65.8 million, and $125.4 million, respectively. These estimates could change if we continue to grow our business through expansion or experience increased production levels.

We provide compensation to existing employees in the form of cash awards which are subject to ratable vesting terms with service requirements. We amortize these awards to compensation expense over the