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Brokers at home in a foreign tongue find built-in edge with ethnic groups

In 1982, Claudio Tarchi stepped ``off the boat.'' Back in Italy, he'd been a journalist for Il Mattino di Padova. But shortly after arriving in America, a friend suggested he become a stockbroker. ``When I entered this business, I thought being Italian would be a disadvantage,'' says Mr. Tarchi from his Merrill Lynch & Co. office on California Street. ``Now, I think it is an advantage.''

It's not uncommon for immigrants or minorities to consider their heritage a handicap. But in selling securities, where communication and trust are invaluable, familiarity with another language and culture can be used to great advantage.

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Indeed, Tarchi's six-figure income after just four years would seem to attest to that. But the business didn't grow just because of his fine Italian features.

Tarchi moved into the North Beach area, a large Italian community on the outskirts of San Francisco. He ran an ad in an Italian-language newspaper. And for a short while after joining Merrill Lynch, he did weekly economic reports on a local Italian radio station.

To many of the 90,000 brokers in the United States, ``cold calling'' - soliciting business from people one doesn't know - is one of the fundamental methods of building a customer base. But Tarchi says it wouldn't work in North Beach.

``The Italian community doesn't like it,'' he says. ``In Italy, it's against the law to call people on a financial matter. They distrust that approach here, also. They don't like to do business over the phone.''

So initially, the newspaper ads were important. Now most of his new clients come through referrals. Two years ago, he founded Italia Oggi, a Young Italian-American Club. ``We now have 120 members and it is one of the most active in the United States,'' he says proudly.

Involvement with the club, charities, and other community projects doesn't directly bring him new clients, but it is ``a good source of exposure,'' he says.

With his Italian customers (half his client base), business is conducted primarily in their native tongue. And that's Tarchi's essential edge: language skills.

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``It's not a question of being Italian, Spanish, or Chinese. It's a question of language facility,'' says Gene Mag, president of Fiduciary Advisory Inc., a New York recruiting firm specializing in stockbrokers. ``A Chinese-American who doesn't speak Chinese dosn't have much of an advantage,'' Mr. Mag points out.

Mike Wong would agree. The second-generation Chinese-American sits next to Claudio Tarchi, started at the same time, and has similar production figures.

Mr. Wong speaks Cantonese, and about 55 percent of his clients are Chinese. But only a few of his clients say they're doing business with him because he's Chinese. ``Regardless of what race I am, the communication has to be there,'' he says.

But understanding the cultural mores doesn't hurt. In their respective ethnic communities, Wong and Tarchi say, there's a strong emphasis on family. ``A lot of my accounts are grandfather, father, and son. The son is generally my age, just starting out,'' says Wong.

But the Chinese culture respects age. ``The easiest way to lose a client is by ignoring the elders. If a father and son come to my office, I always ask the questions of the father, even if it's the son's money.''

Similarly, Tarchi says: ``Once they trust you, they trust you with all the family business. But you have to be very careful. If you lose the trust of one, you lose the whole family.''

Investment philosophies tend to be guided more by age and finanical goals than by ethnic background. But Tarchi says, ``Nine out of 10 Italian portfolios have BankAmerica, TransAmerica, PG&E, and Chevron.''

He notes that Bank of America was founded by an Italian, while TransAmerica was a spinoff from the bank. Pacific Gas & Electric pays good dividends and used to be family-owned - ``Italians like family-operated businesses.'' Chevron is also locally based.

Tarchi also has a large Filipino clientele, left to him by a departing broker. In fact, these customers are more profitable for him. ``They have more of a gambling side, they enjoy more the options.'' Tarchi sees a ``huge market'' in the Philippines and plans to visit there this year.

Wong also sees growth from Pacific Rim customers. He already has Hong Kong and Taiwan clients who spend part of the year in San Francisco. The Taiwan community here is growing and ``the affluence is there,'' he says. ``My only regret is that I don't speak Mandarin.''

At least, not yet. He's studying the language.

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