I was a little too optimistic, as it turns out, about A.G. Edwards’ ability to remain independent. The years of rumors came true with today’s announcement that the venerable St. Louis brokerage firm is being acquired by Wachovia. On a conference call, Edwards CEO Robert Bagby made a takeover sound inevitable. “We knew we needed scale, we needed additional products,” he said. “The demand from clients is to provide one-stop financial services. We couldn’t provide that at A.G. Edwards; we didn’t have the capital to provide that.”

 I have two big questions at this early hour:

1. Will it work? Several other bank-brokerage mergers have stumbled, but Wachovia seems to have been very successful since taking over Prudential Securities in 2003.
2. What’s the net effect on St. Louis? We lose a major corporate headquarters, but we become home base for the nation’s second-largest retail brokerage operation. It sounds like some brokerage-headquarters jobs will move here from Charlotte. But it also sounds like A.G. Edwards divisions that don’t interface directly with the retail brokers — such as investment banking, institutional sales and money management — will depart from St. Louis.