Trust Us—There May Be Job Growth in Trust Services
Trust services, once the forgotten stepchild of banking, is gaining a higher profile in the financial services industry, as institutions look to expand their offerings to offset losses elsewhere.
Speaking with eFinancialCareers, Bernard Garbo, senior editor of the Trust Performance Report, noted that U.S. trust account assets increased 4 percent in 2011 and gross revenues jumped 11 percent.
”The industry is becoming more efficient in extracting revenues. The institutions are doing well and will continue to,” says Garbo. That bodes well for future job growth, especially as additional brokerage firms test the waters with trust services. “They see it as a way to improve their business,” he adds.
The Universe of Trust
According to Garbo, trust account assets totaled $34 billion in 2007, and then they proceeded to drop off considerably in the downturn. The figure includes bank trust departments, brokerage trust services and independent trust companies.
But things appear to be on the mend, says Garbo, with the industry once again in growth mode. He notes that assets topped out at $33 billion in 2011. “It’s a very good sign—a sign that the industry is solid.” Garbo refers to the largest players in trust services as the “trillion dollar club,” including the likes of BNY Mellon, State Street, Chase, Citi, Northern Trust, Wells Fargo, U.S. Bank and Fidelity Management.
The State of the Industry
One of the biggest reasons that the bank trust departments are hiring and promoting staff is the brain drain in the industry, says Garbo. In the past, many finance professionals simply didn’t look to trust services for a career, he adds.
But the growth of wealth management and layoffs in many other areas of financial services are accounting for additional hiring and increased interest in trust jobs by industry professionals. And, despite the size of bank trust divisions, there are also growing job opportunities at brokerage firms and independent trust companies.
As the big banks move up the food chain, opting for the wealthiest clients, brokerage firms and the independents are benefiting by targeting the wealthy, but a bit less well-heeled individual, overlooked by the biggest banks.
Show Me the Money
Of the universe of players in trust services, many might assume the global and larger banks would offer the highest salary for their trust department staff and the smaller independents would give their personnel the least.
“When we look at expense allocation," says Garbo, "the bank trust departments reportedly allocate more to salary than the independents, but that may not necessarily translate to salaries.”
In fact, Garbo surmises that the independents just may offer a bigger paycheck to their employees, since they split the money between a smaller staff than the large bank trust departments. The independent trust companies are also, generally speaking, much more productive than their banking counterparts, he adds.
The Skinny on Hiring
In an interview with eFinancialCareers, Maggie Cunningham, managing director, wealth management search consultant for BancSearch, confirmed a spate of hiring for a variety of trust department positions at PNC Bank, as well as at U.S. Bank.
“I think part of the hiring now is that banks held off for so long on hiring that they now have to. Plus, there are many positions where people are filling spots where others have retired,” said Cunningham.
She acknowledges a graying of trust departments presenting additional opportunities for those in the space. Cunningham notes that there is a demand for trust relationship managers, fiduciary officers and wealth advisors, but many of the titles for the very same position do differ depending on the bank.
For trust advisory firms—firms offering professional administration of trusts, but no investment advice—jobs are also on the increase.