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Research finds banks will expand and need to deliver more


Research from global analytics firm Cerulli Associates finds that private banks and trust companies' assets are projected to reach USD5.3 trillion by year-end 2019.

"With growing competition, most banks can no longer consider asset allocation their core differentiator," says Donnie Ethier, associate director at Cerulli. "Delivering comprehensive goals-based planning that includes the softer non-financial elements of wealth is more important than ever."
In their most recent report, Asset Management Opportunities in Banks 2015: Capitalizing on a Resurgent Focus on Wealth Management, the firm focuses on investors, asset managers, and banks.
Cerulli concentrates on best-practice banks that have centralised the investment decision-making process across all of their wealth management platforms, including broker/dealer, trust department, RIA, and family office.
"Banks have unique characteristics that most other channels cannot fully replicate," Ethier says. "Such as the ability to be an all-in-one provider for any household. Banks that are not promoting their full offering are doing their firm and their clients a disservice."
"The channel's most promising trends include: client-centric advisory models, integrating wealth management platforms, consolidating research teams and portfolio construction processes, and centralizing fee discounting decisions," Ethier explains.
Cerulli's research finds that asset allocation is no longer a main distinguisher, which is only being validated more by the increase in direct-to-consumer providers and the electronic registered advisors (eRIAs)/robo-advisers. The firm believes that delivering holistic goals-based planning that can incorporate the softer non-financial aspects of wealth is more important than ever for banks to differentiate themselves from the low-cost investments provided by the eRIAs.

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