HOLLYWOOD, Fla. -- Banks continue to lose out on the wealth management opportunities in front of them. That was one of the takeaways from a session at BISA's annual conference here moderated by Amanda Smith, senior vice president and head of marketing for Fidelity's National Financial.
Fidelity conducted a survey that found bank executives expect wealth management revenue to increase 25% by 2018. And there's good reason for high hopes. High-net-worth customers have more confidence in banks than brokerages, she says. And mass-affluent customers are more likely to consolidate their banking and investment relationships with one firm.
Unfortunately, there are two challenges standing in the way of banks reaping these rewards: lagging technology and the age-old cultural problems at banks.
On the technology front, Smith said that Fidelity's research indicates that 80% of bank advisors said a paperless process would help. But far fewer bank advisors have that option compared to RIAs. And these issues are only compounded by continually rising client expectations, she says.
On the cultural front, banks are still siloed and too often customers do not get a unified experience.
Mike Norton, senior vice president and head of relationship management for the bank segment at Fidelity, was a panelist at the session. He says that an increasing number of banks offer a single sign-on, which is a benefit, but even then customers are often seeing a varied experience across the silos of a bank. The whole experience needs to be more streamlined, he says.
For banks embarking on an effort to offer a more unified experience, they would be wise to pick their battles, says Leah Wehinger, senior vice president of SunTrust's Private Wealth Management group.
"There are 29 things you can do as your first effort, pick three," she says. First, find the "stupid things" and kill them. She says companies can amass some stupid policies that will only get in the way. Then, pick two things that your bank can do better than anyone else, and focus on those, she suggests.
As for communication, which is often cited as the answer to many operational challenges, she said it needs to be very specific so everyone involved knows who will do what and when. "The single greatest challenge in communication is the allusion that it's happened," Wehinger says.
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