Wealth Management and Bank Trust: A Powerful Combination for the Evolving Financial Landscape

The financial services industry is undergoing a transformation, with bank trusts experiencing a paradigm shift. Traditionally, bank trust departments offered a range of services, including trust administration and wealth management. However, the lines are shifting as forward-thinking banks are refocusing on wealth management for their trust clients.

This strategic move reflects a deeper emphasis on providing a seamless client experience, but more importantly, it's a response to client demands and the need to stand out in a competitive environment. Wealth management is no longer just an additional service provided by bank trusts; it's becoming the central pillar of their value proposition.

A One-Stop-Shop

This integrated approach caters to the growing demand for comprehensive financial guidance, encompassing wealth creation, preservation, and distribution. It allows banks to better serve their trust clients by providing a one-stop shop for all their wealth management needs. Several factors are fueling this convergence:

• Client Demand for Integrated Solutions: Clients, particularly high-net-worth individuals (HNWIs), are seeking comprehensive financial guidance that encompasses wealth creation, preservation, and distribution. A 2023 study by Capgemini found that 71% of HNWIs expect their wealth management provider to offer trust and estate planning services. This demand for integrated solutions necessitates a closer collaboration between wealth managers and trust professionals.

• The Evolving Role of Banks: Banks are increasingly recognizing the limitations of solely offering traditional products like savings accounts and loans. To stay competitive, they're strategically expanding their service offerings to make wealth management a core pillar for Bank Trusts. A Deloitte study found that a whopping 78% of banks are planning to significantly increase their wealth management services within the next two years. This shift necessitates the need for robust trust accounting systems within banks to effectively manage the complexities of client assets as wealth management takes center stage.
• The Rise of Independent Advisors: The number of independent Registered Investment Advisors (RIAs) is growing. Driven by client demand for trust services, a growing number of Registered Investment Advisors (RIAs) are expanding their offerings to include trust management, an area traditionally requiring partnerships with larger institutions. Fintech solutions like Cheetah are facilitating this shift by enabling RIAs to manage trust assets similar to bank trusts, all while offering a streamlined accounting process. This connection empowers RIAs to expand their service offerings, particularly trust services, allowing them to cater to a broader HNW client base.

Benefits of the Convergence

This convergence of wealth management and bank trust services offers significant benefits for both clients and financial institutions:

• Enhanced Client Service: Clients can now receive comprehensive financial planning under one roof. Wealth advisors can leverage trust and estate planning expertise to create a more holistic financial strategy for their clients. This integrated approach helps ensure that investment decisions are aligned with clients' long-term goals and legacy wishes.
• Improved Efficiency: By integrating wealth management and trust accounting systems, financial institutions can streamline workflows and eliminate data silos. This reduces the administrative burden on advisors and allows them to dedicate more time to client relationship building and strategic planning. A study by Aite Group found that financial institutions with integrated wealth management and trust platforms experience a 20% increase in advisor productivity.
• Growth Potential: The ability to offer a wider range of services unlocks new business opportunities for both banks and wealth advisors. Banks can attract and retain HNWIs by providing integrated wealth management and trust solutions. Similarly, advisors can expand their client base and service offerings by collaborating with trust companies.

AssetMark and Cheetah: A Winning Collaboration

AssetMark, a leading provider of wealth management solutions for financial advisors, and Cheetah, a top cloud-based trust accounting system, have joined forces to capitalize on this growing trend. Their combined solutions provide a comprehensive platform that empowers financial professionals to seamlessly manage both wealth management and trust aspects of their clients' finances.

The AssetMark-Cheetah collaboration offers several advantages:

• Curated Investment Solutions: AssetMark provides advisors access to a wide range of investment products and strategies, allowing them to tailor portfolios to meet individual client needs.
• Advanced Wealth Management Tools: AssetMark's platform provides robust portfolio management, trading tools, and market insights, empowering advisors to make informed investment decisions.
• Best-in-Class Trust Accounting: Cheetah's cloud-based system streamlines trust administration tasks, automates workflows, and ensures accurate recordkeeping.
• Seamless Integration: The two platforms integrate seamlessly, enabling advisors to manage wealth management and trust functions within a unified system. This eliminates the need to switch between multiple applications and reduces the risk of data errors.

The Future of Wealth Management

The future of wealth management lies in integrated solutions that address the evolving needs of clients and the competitive landscape. The AssetMark and Cheetah collaboration exemplifies this trend, paving the way for a more efficient, client-centric, and holistic wealth management experience.

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AssetMark and Cheetah are separate and affiliated companies. Each company is responsible for their own content and services.

6539820.1 | 06/2024