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Research finds banks will expand and need to deliver more

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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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