Annual Checkup Reveals Softness In Growth Engine

While financial institutions grew their revenue a robust 9% in 2018, this year’s Kehrer Bielan Annual Industry Checkup identified a troubling trend: banks and credit unions are losing ground in the uphill climb to recruit and retain the advisors needed to grow the business. Decades of research by the firm have confirmed that adding advisors is a key to growing revenue and increasing penetration of the institution’s customer opportunity.

But last year the number of advisors working in financial institutions was actually down almost 3%. At the same time, their banking customers were growing their investible assets, so advisor coverage of the opportunity actually declined even further.

Looking back at previous Checkups, we have observed differential experience between the banks that own their own broker dealer and the institutions affiliated with third party BDs (aka “TPMs”). In 2017, bank BDs were flat, while the TPM partner institutions had robust growth in advisor headcount, but in 2016 bank BDs experienced modest growth, but the smaller institutions suffered a significant decline. This year, advisor headcount dipped in both kinds of financial institutions.

Last year’s robust markets helped boost investment services revenue, as banking customers were drawn to invest in a hot market, and soaring market valuations generated outsized fees on assets under management. But the market correction in the fourth quarter was a reminder that sustainable growth will require adding more advisors.

An aging and shrinking advisor population makes advisor recruiting increasingly challenging, and historically financial institutions have suffered significant advisor turnover, but last year Kehrer Bielan surveys found that banks and credit unions had improved advisor retention, and have started to embrace systematic ways of developing advisors, instead of bidding them away from competitors.

The Annual Industry Checkup has been conducted by Kehrer Bielan Research and Consulting every year since 2012. The firm draws on regulatory filings and its own proprietary surveys of banks, credit unions, and third party broker dealers to monitor the health of the financial institution insurance and securities industry. This year’s study was based on data from 2,329 financial institutions and their 11,089 advisors, and was sponsored by CUSO Financial Services and Sorrento Pacific Financial.


CUSO Financial Services, L.P. and Sorrento Pacific Financial, LLC (Members FINRA/SIPC) are subsidiaries of Atria Wealth Solutions. Established in 1997, they specialize in placing investment programs inside credit unions and banks, providing customized investment and insurance solutions to over 200 financial institutions throughout the country, with $30+ billion in AUA. Headquartered in San Diego, with branch offices nationwide, both broker-dealers are SEC Registered Investment Advisers, with expertise in key areas including retirement services, wealth management, advisory solutions and insurance products for individuals and business customers. For more information, see or visit their LinkedIn pages: CFS and SPF.

Download your copy of the Annual Industry Checkup or contact:

Connie Gregory, SVP
Cell: 818-388-8522
Office: 858-530-4440