• Think Trump Will Scrap the DoL Rule? Bank Execs Disagree

    In the ten days since Donald J. Trump became the president-elect, we have heard hopeful speculation in boardrooms and in the media that the new administration will throw out the Department of Labor's Fiduciary Rule for qualified retirement accounts, set to go into effect on April 10, saving our industry from adapting to perhaps the largest regulatory change it has ever faced.But the executives who run the investment services businesses in banks and credit unions aren't buying the hype.A ...  Read More...

  • Setting Revenue Expectations for Next Year

    When we convened our semi-annual study group of top bank brokerage executives in Chapel Hill last month, one topic immediately emerged as being a top concern for the group – they expect investment services revenue to decline in 2017, but bank management actually expects revenue to grow.The gap in expectations is enormous. The brokerage executives project their firm's revenue to fall 7% to 20% next year due to the disruptions caused by the implementation of the Department of Labor's...  Read More...

  • Advisors' Life Production Up 27% since 2010 in Banks and Credit Unions

    Strong Foundation for Growth under the DoL Fiduciary StandardIn our discussions about DoL readiness with top executives responsible for investment services in financial institutions, it is clear that they plan to focus more on life insurance sales to bolster an expected decline in revenue from commission transactions and lower fees on advisory accounts.  But many are surprised to learn that banks and credit unions have made steady progress in growing their life insurance sales over the past...  Read More...

  • As Goes the Financial Plan, So Go the Assets

    With implementation of the Department of Labor's fiduciary standard for qualified retirement accounts just around the corner, firms are looking to financial planning to help their advisors fulfill their responsibilities under the rule and justify the fees they charge. That was one of the central themes at Kehrer Bielan's recent study group on The New Importance of Financial Planning and Life Insurance After DoL, held last week in Chapel Hill, NC.But the planning specialists and other exe...  Read More...

  • Planning to Sell More Life Insurance?

    Advisors Who Prepare More Financial Plans Produce More Life Insurance RevenueFor decades banks and credit unions have struggled to profitably meet the life insurance needs of their clients.The DoL Fiduciary Standard rule for retirement accounts increases the need to improve life insurance sales, because firms are looking for ways to replace revenue impacted by lower fees and commissions.But selling life insurance just got even harder. Our last Highlighter provided evidence that additional compen...  Read More...

  • Paying More for Life Sales May No Longer Work

    Banks and credit unions have struggled for years to profitably meet the life insurance needs of their clients.Now, the advent of the DoL Fiduciary Standard rule for retirement accounts creates more urgency to improve life insurance sales.  Many product lines are expected to experience fee compression, and a shift to advisory business could result in a short term dip in revenue, so firms are looking for ways to fill the revenue shortfall.The situation appears to be exacerbated by the deterio...  Read More...

  • What Are Referrals Worth?

    Advisors in banks and credit unions enjoy an advantage over other providers of financial advice because they have the support of the branch network and the client referrals branch staff generate. How valuable are these referrals? The market tells us how advisors value them.Kehrer Bielan research on advisor compensation finds that at every level of production advisors based in bank or credit union branches earn a payout that is at least 5 percentage points less than other bank-based advisors who ...  Read More...

  • Banks Need to Play Catch Up on Financial Planning

    Kehrer Bielan research estimates that 11% of US households have a written financial plan, but only 10% of those financial plans were obtained from a bank or credit union. This means only 1% of US households have obtained a financial plan where they bank.Those metrics have to change if financial institutions are going to prosper as the DoL Fiduciary Standard is adopted.  As investment advice is commoditized, investment services businesses have to find ways to differentiate their offering.Why...  Read More...

  • Platform Investment Reps Under DoL

    Throwing Baby Out with the Bathwater?In the wake of the Department of Labor Rule on the Fiduciary Standard, many banks with licensed or registered client-facing banking staff are considering dropping their "platform banker programs."  These firms wonder how they will be able to implement the elements of a fiduciary standard with staff that turn over every 18 months on average, including ensuring that the investment advice offered is in the best interest of the customer, and provid...  Read More...

  • For Many Millennials, Robos Do Not Compute

    Millennials Prefer Banks, Credit Unions for AdviceThe robo Advisors have positioned themselves to attract Millennials, but new Kehrer Bielan research suggests that there may be a glitch in the robo model - Millennials think they will get better financial advice from a financial institution. Nearly half of households headed by a Millennial agree with the statement, "Banks, S&Ls and credit unions are the best source of advice regarding my savings and investments." In fact, ...  Read More...

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