For all the worry and anger over the Labor Department's new fiduciary rule, the nation's largest banks appear to be uncommonly relaxed.
Senior executives of J.P. Morgan Chase, Regions and SunTrust expressed confidence in their ability to weather the impact of the rule on their wealth businesses during recent earnings calls with analysts.
"On first read, there are no significant new provisions from the proposal that would change our position," said J.P. Morgan Chase's CFO, Marianne Lake. "Based on our current advisory business, we are confident in our ability to adjust and be successful."
Regions CEO Grayson Hall was equally positive. "Given the history and the makeup of our book, we think it's a very manageable process for us," he said.
SunTrust's CEO, William Rogers Jr., called the new rule "highly manageable" and described its potential impact as marginal. "I don't think this is going to be a big story in terms of a change in direction in our private wealth business," he said.
All three noted that their institutions had been fiduciaries for many years and were comfortable operating under a fiduciary model.
Still, they acknowledged the complexity of the rule and were relieved to have a longer period of time in which to implement it.
"It will take time to fully digest," said Lake.
The rule, which goes into effect on Jan. 1, 2018, requires advisors to apply a best-interest fiduciary standard when giving retirement advice to clients. It prohibits the charging of commissions on retirement investment products unless the advisor complies with rigorous disclosure requirements.
Register or login for access to this item and much more
All Bank Investment Consultant content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access