LPL Financial (NASDAQ: NASDAQ:LPLA) shares fell Wednesday after the company announced the immediate termination of President and CEO Dan Arnold after the close on Tuesday.

The decision came after an investigation found that Arnold made statements violating LPL’s Code of Conduct, leading to his departure from both his executive role and the Board of Directors.

The Board has appointed Rich Steinmeier, LPL’s Chief Growth Officer, as interim CEO. Steinmeier, who has been with LPL since 2018, has served in various leadership roles, including Divisional President and Chief Growth Officer.

The company stressed it has full confidence in Steinmeier and the management team to ensure a smooth transition.

According to James Putnam, Chair of the Board, LPL’s commitment to a “supportive and professional workplace” led to Arnold’s termination, adding that the firm will remain focused on providing long-term value to clients, employees, and shareholders.

The announcement has created some uncertainty in the market. Analysts at Bank of America raised concerns over the leadership disruption and its potential impact on the firm’s future strategy.

However, a BofA analyst maintained a Buy rating for the stock, raising the price target to $274 from $268.

The analyst acknowledged the leadership shift as a short-term negative but expressed optimism about the company’s long-term strategy once Steinmeier and CFO Matt Audette outline their plans.

Despite the leadership change, Putnal commented that the "company has significant momentum in the marketplace and its business model and financial strength position it well to continue creating long-term value for clients, employees and shareholders.”

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