Affluent Clients Are Wary of the Banking Segment

May 22, 2023 — Boston

Wealth management providers in the banking industry must highlight their stability to maintain market position

Affluent investors remain confident of the safety of their own assets but wary of the banking segment overall, according to the latest Cerulli Edge—U.S. Retail Investor Edition.

28% of affluent households report using a bank-related platform as their primary provider of financial services—18% rely on bank advisors, 7% rely on depository programs, and 3% work with private banks. Reliance on bank advisors (29%) and bank deposit programs (15%) is most prevalent among households with $100,000 to $250,000 in investable assets, and it falls with increasing wealth. In all, 43% of households with $100,000 to $250,000 in investable assets partner with bank providers as their primary financial services option.

While the research finds that most affluent investors, 95%, are confident in the disposition of their own assets, just 59% of affluent investors overall indicate they are “very” or “somewhat” confident in the stability of the banking system itself. Investors working with the wirehouse channel (71%)—firms affiliated with some of the world’s largest banks—and those working with advisors in banks themselves (73%) express the most confidence in the solidity of the segment. Private bank clients, however, paint a blurrier picture at a 58% confidence level.

Furthermore, more than half of respondents (52%) report a decreased level of confidence in the banking segment in the previous months, and nearly two-thirds (63%) of investors favor increased federal regulation to reduce the likelihood of future crises.

“With all financial services built on a foundation of trust between clients and providers, maintaining, or in this case rebuilding, a perception of long-term stability is crucial,” says Scott Smith, director. “Recent events in the banking space could be an opportunity for advisors to reassure clients of banking stability and provide an empathetic ear for depository customers' concerns. This can help advisors retain maturing clients as they accumulate greater wealth.”

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Note to editors

These findings and more are from The Cerulli Edge—U.S. Retail Investor Edition, 2Q 2023 Issue.

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