Wells Fargo hopes to attract new clients with over $50million in assets by creating new family wealth unit

Wells Fargo hopes to attract new clients with over $50million in assets by creating new family wealth unit

Merged 2 departments in attempt to create all-encompassing department for wealthy families
Will have experts in traditional wealth investment management and wealth succession planning

By Reuters Reporter

PUBLISHED: 16:26 EST, 2 April 2012 | UPDATED: 16:26 EST, 2 April 2012





Wells Fargo & Co combined two of its wealth management units in an effort to appeal to more of America’s 1 per cent.

The bank launched its new business venture, called Abbot Downing, on Monday after merging two of its existing departments under a new brand it hopes will expand its market share of rich families.

The new business, catering to ultra-high-net-worth individuals and families with $50million or more in investable assets, resulted from the combination of Wells' Family Wealth unit and its Lowry Hill subsidiary.
Targeting the super wealthy: Wells Fargo is dedicating an entire division to families with a collective worth of over $50million

Targeting the super wealthy: Wells Fargo is dedicating an entire division to families with a collective worth of over $50million

Since Wells first publicly announced the planned merger last November, the combined business has grown 20 per cent to $32.9billion in client assets under management.

The success in those five months comes from the additions of five billionaires and 13 individuals with $100million or more in investable assets to its portfolio.

‘We've had new success in bringing in new foundation assets,’ said Jim Steiner, Abbot Downing's president.


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‘People are leaving more money to foundations and endowments.’

The name Abbot Downing comes from the 19th-century New Hampshire builder of the stagecoaches that have come to represent Wells Fargo.

He said the biggest drivers of new wealth have been cash from the sale of company stakes through initial public offerings and mergers and acquisitions.
Inspiration: The name Abbot Downing comes from the 19th-century New Hampshire builder of the stagecoaches that have come to represent the company

Inspiration: The name Abbot Downing comes from the 19th-century New Hampshire builder of the stagecoaches that have come to represent the company

Mr Steiner estimated that about 10,000 households in the United States have $50million or more in investable assets.

In an October study of 72 multifamily advising firms, the average client asset size was $48.4million, according to research and consulting firm Family Wealth Alliance.
Head: Jim Steiner, Abbot Downing's president, explained how they are combining services essentially to make the department a 'one stop shop' for wealthy families

Head: Jim Steiner, Abbot Downing's president, explained how they are combining services essentially to make the department a 'one stop shop' for wealthy families

Abbot Downing has just under 600 clients, including multiple families across generations.

Mr Steiner said the decision to rebrand the combined business was meant to establish a small-firm feel.

Wells intended to distinguish its family wealth business from that of other bigger competitors.

Abbot Downing was aiming to keep a client-to-adviser ratio of 15-to-one, which Mr Steiner said was low.

‘Their biggest challenge will be to differentiate themselves from others,’ said Tom Livergood, founder of Family Wealth Alliance.

The family wealth management industry is highly fragmented, Mr Livergood said, because of the wide-ranging needs of its clients -- including traditional wealth investment management, as well as wealth succession planning.

Abbot Downing has four divisions: an asset management division, a private banking channel, a combined trust and fiduciary service, and a group that addresses family psychology and governance.

While they already have about 300 Abbot Downing employees across the United States, Mr Steiner said the firm would be hiring senior portfolio managers, analysts, relationship managers and planners.

The new business is the fourth under Wells' Wealth, Brokerage and Retirement Group umbrella, which also includes an institutional business, a private bank and a brokerage arm.

Read more: http://www.dailymail.co.uk/news/article-2124208/Wells-Fargo-hopes-attract-new-clients-50million-assets-creating-new-family-wealth-unit.html#ixzz2bhdbwvve