A Wake-up Call for Wealth Management

As I was catching up on my reading after taking time off for Thanksgiving,  I ran across an intriguing recent article in the Chicago Tribune titled, “Many advisers don’t make the grade”.  The story, based on survey recently conducted by Pittsburgh-based PNC Financial Services’ Wealth Management unit, asked individuals with at least $500,000 in investable assets to assign letter grades to their financial institution based on their personal experiences.  The results were interesting on several levels:


  • 15% gave them an A – made a huge positive difference

  • 31% said B – helped some, but could have done more

  • 44% said C – didn’t make much difference one way or another

  • 10% said D or F – harmful in some way

The survey also noted that three quarters of respondents demand greater transparency and more than half look for more comprehensive solutions. A PNC executive noted the findings are significant: “This should serve as a wake-up call in the financial services advisory business,” said Thomas Melcher, managing director of Hawthorn, the division of PNC Wealth Management that serves clients with $20 million or more in assets.  “These results clearly tell us that most wealthy investors are willing to listen to a provider who has a better story, and that managing wealth is more than managing investments. They want someone to help them. But whoever helps them is going to have to work.”


This was like a signal flare going off,  since I spend a lot of time researching the impact of analytics and decisioning at banks.  The fact that over half of these customers would be very receptive to a proposal from another provider sends a strong message – to me and hopefully all wealth management providers.  Now think about this: if “wealthy” investors feel this way given they’re high touch clients that get more personal treatment, how do you think a bank’s “core” customers feel?  Because a bank rarely owns an entire customer relationship, they are being pitched by the competition and this survey shows customers are RIPE for switching.  I would think banks would feel a little nervous after seeing these statistics.