SunTrust Bank's trust and investment management business endured another quarterly lashing, according to the bank's latest financial results released on Friday.
Third-quarter revenue from trust and investment management services declined 8% to $86 million from $93 million in the same period a year ago. Revenue, however, was up a modest 2% from the prior quarter.
The year-over-year revenue decline was due largely to a decrease in assets under management, the company said in the earning release.
"Wealth management-related income declined modestly this quarter given market conditions, which resulted in lower assets under management and reduced transactional activity," William Rogers, chairman and CEO of SunTrust Banks, said during the earnings call. "Irrespective of short-term market fluctuations, meeting our clients' wealth and investment needs continues to be a strategic priority for our company."
At the end of the third quarter, the trust and investment services business had $42.3 billion in assets under management, down 13% from $48.8 billion a year ago.
For the first nine months of 2015, trust and investment services generated $255 million, down 25% from $339 million a year ago. The decline was due to foregone revenue resulting from the sale of asset management firm RidgeWorth Capital Management in the second quarter of 2014, the parent of the Atlanta-based bank said in the earnings release.
The retail brokerage business turned in a stronger performance. Third-quarter revenue from retail investment services inched up 1% to $77 million from $76 million in the third quarter last year. Revenue, however, was off from the prior quarter, falling 4%.
For the first nine months of 2015, the retail brokerage business hauled in $229 million, 2% more than it brought in last year. Its assets under management also increased, albeit modestly, rising 1% to $47 billion from $46.4 billion a year ago.
During the earnings call, Rogers referred to the management changes the company announced yesterday, including the appointment of Tom Freeman, the chief risk officer, to leader of the Consumer Banking and Private Wealth Management business.
"These changes align top talent with significant opportunity in our company and this will sharpen our focus and enhance our growth prospects," Rogers said.
Overall, SunTrust Banks, the parent of SunTrust Bank, earned $519 million in the third quarter, or $1 per share, compared with $563 million, or $1.06 per share, it earned in the same quarter a year ago.
"We made solid progress against key strategies, including optimizing our business mix and balance sheet, investing in growth opportunities, improving efficiency and growing our capital return," Rogers said. "Overall, I remain optimistic about our company's strategic direction and our ability to deliver further value to our clients and shareholders."
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