ABA Banking Journal Podcast
Capitalizing on Opportunities to Serve High-Net-Worth Clients
Why It Matters
Understanding these trends helps banks and financial professionals adapt to a market where RIAs are capturing more high‑net‑worth business, and where clients demand holistic advisory services beyond simple investment management. By leveraging partnerships or building in‑house capabilities, community banks can capture a share of the multibillion‑dollar wealth transfer and strengthen client loyalty.
Key Takeaways
- •RIAs rapidly capturing high‑net‑worth market share
- •Community banks can rent platforms like LPL to compete
- •High‑net‑worth clients demand integrated tax, estate, charitable planning
- •Private equity consolidates RIAs for scale and profitability
- •Breaking silos within banks unlocks wealth‑transfer opportunities
Pulse Analysis
The wealth‑management landscape is being reshaped by the explosive growth of registered investment advisors (RIAs). Over the past three to five years RIAs have captured a disproportionate share of high‑net‑worth assets, often managing portfolios from $1 million to $100 million. Their appeal lies in greater independence and a revenue model that can keep up to 80 % of advisory fees, compared with the 40‑45 % typical at wire houses or bank platforms. This shift is prompting banks and trust companies—traditionally focused on assets above $3 million—to reassess how they compete for affluent clients.
Community banks, lacking the scale of national institutions, are turning to flexible solutions to stay relevant. Many are partnering with turnkey platforms such as LPL Financial, which supply a full suite of advisory tools, compliance support, and investment products on a rental basis. Others are launching their own RIAs, navigating state‑by‑state ownership rules while leveraging existing trust officers for administration. These hybrid models allow banks to offer high‑net‑worth services quickly, without the capital outlay of building a proprietary infrastructure, and position them to capture wealth transferred from retiring baby‑boomers.
Affluent families now expect more than basic investment advice; they seek integrated tax, estate, charitable, and asset‑protection planning. A 2023 CEG Worldwide study showed that while 90 % of advisors claim to provide these services, clients perceive delivery in only about 20 % of cases, highlighting a critical service gap. Banks that break internal silos—aligning relationship managers, trust officers, and advisors—can deliver the holistic guidance that high‑net‑worth clients demand and secure a seat at the table during liquidity events. As private‑equity firms continue to bundle RIAs for scale, community banks that adopt collaborative, client‑centric models will be best positioned for future growth. ABA’s upcoming Trust Schools provide practical training to help banks navigate these challenges.
Episode Description
Several factors — the growth of the U.S. economy and asset prices, generational transitions and changing values — are reshaping the wealth management and financial advice sectors. More individuals and families are falling into the high-net-worth (investable assets of over $3 million) and ultra-high-net-worth (assets of over $30 million) than ever before. How are banks positioned to capitalize on this evolving marketplace? On the latest episode of the ABA Banking Journal Podcast, ABA's Mark Benskin — a veteran of the wealth management sector with experience at several banks — discusses:
The structural shift in the wealth management business, including the rise of Registered Investment Advisors that serve HNW and UNHW clients.
The mix of services — estate planning, tax planning, asset protection and charitable planning — that clients are seeking from their advisors.
Evolving revenue models for wealth management and the pursuit of scale.
The strategic question for banks of building versus "renting" infrastructure.
How banks are positioned to break down institutional silos that hinder full-service client engagement.
Learn more about the ABA Wealth and Trust Schools.
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