E*Trade Financial to buy Retirement Advisors of America

E*TRADE FINANCIAL Corporation (NYSE: ET) today announced its intent to acquire Retirement Advisors of America (RAA), a Dallas, Texas-based registered investment adviser managing over $1 billion in assets.

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The acquisition strengthens E*TRADE FINANCIAL's regional adviser strategy, which delivers localized wealth management services and advice to retail and Corporate Services clients with a minimum of $250,000 in assets.

RAA joins the E*TRADE Wealth Management network of Howard Capital Management (Los Angeles and New York), Kobren Insight Management (Boston) and the investment adviser group of Harrisdirect LLC, totaling nearly $3 billion in assets under management.

With nearly 1,300 high-value client relationships, the RAA acquisition is expected to provide a predictable and recurring revenue stream with a scalable business platform that can manage additional client assets with minimal incremental expense. E*TRADE FINANCIAL expects the transaction to be slightly accretive in 2006, with approximately $9.3 million in annualized revenues in FY 2006.

"An increasing number of E*TRADE FINANCIAL customers are seeking support in making more complex financial decisions," said Jon Foster, Head of Wealth Management, E*TRADE FINANCIAL. "With the acquisition of RAA, E*TRADE FINANCIAL enhances its advisory service for customers in Texas - a state with a high concentration of our retail and Corporate Services customers."

The RAA acquisition is expected to close in Q3 2006, following customary closing conditions. E*TRADE FINANCIAL will continue to look toward acquiring established wealth management firms in key customer markets including New York City, Philadelphia, Greater Washington DC, Atlanta, Orlando, Chicago, Denver, Scottsdale, San Diego, Silicon Valley and San Francisco.

"RAA's new relationship with E*TRADE FINANCIAL should prove to be highly advantageous to our clients," said Scott Frost, RAA's CEO. "RAA was attracted to E*TRADE FINANCIAL's history of innovation, its client-centered culture, as well as the Company's commitment to providing multiple channels for wealth advisory services to customers."

As a subsidiary of E*TRADE FINANCIAL, Retirement Advisors of America will operate in a manner consistent with past practices of the former company, retaining its senior management team, all of its personnel, and its complete offering of investment and retirement services. Terms of the agreement were not disclosed.

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