ABA Banking Journal - February 2011 - (Page 22)
ABA COMMUNITY BANKING | WEALTH MANAGEMENT CASE management. “In the past, most of us looked at a customer’s brokerage account rather than looking at everything,” says Maynard. “The upheaval has caused us to rethink how we’re doing business and mak- half_page_island_racecar_Layout 1 1/13/11 5:07 PM Page 1 ing sure we’re looking at it all.” Banks also are looking at wealth management as a source of revenue to help offset a weak economy and waning profits. In Maynard’s view, those that don’t have or promote a Tune Up Your Contingency Liquidity Plan • Millions Settled Daily - Non-Brokered • Unlimited Funding and Investing • No Paperwork - Regulator Friendly wealth management operation are forfeiting a viable line of business for themselves—and a valuable service for their customers. “Community banks want to be able to provide their customers with across-theboard services,” he says. “Being able to do [only] traditional banking and lending means missing out on an area where we can help a lot—estate planning.” Southern Community Bank and Trust expects the ongoing fees it receives for managing investments and assets to become an increasingly large percentage of its earnings. Maynard says there is no best way to structure fees. Some customers prefer fee-based approaches based on the amount of assets the bank manages for them; others would rather pay a per-transaction cost. “Neither is wrong,” he says. “A lot depends on what makes the most sense for the customer.” What makes the most sense for both the customer and the bank is to manage well the clients’ wealth. Over the next decade or so, there will be changes with the generational shift in wealth, making its management all the more essential. “All of us are going to have to become better at generating income strategies for our customers,” Maynard says. “The key thing is going to be making sure that we’re developing income streams for customers so they can’t outlive their income.” n 800-246-0005 cdrateline.com 22 | ABA BANKING JOURNAL | FEBRUARY 2011 How a large bank approaches wealth management There is more similar than dissimilar in how $60 billion Bank of the West succeeds in wealth management compared with Southern Community Bank & Trust, the $1.4 billion bank profiled here. Read more in Bank Notes, p. 13.
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