Money management: Wealth effect

 In Business Handbook 2017

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The biggest megatrend in financial services may be the $30 trillion wealth transfer from baby boomers to their children over the next 30-40 years, creating vast opportunities for banks, brokers, insurers and other financial-services companies. In many instances, heirs fire their parents’ financial advisers, creating new business opportunities that sales-oriented managers lust after. U.S. Bancorp, the nation’s fifth-largest bank, just hired a veteran Wells Fargo executive to boost its presence in the wealth-management business.

KAREN WIMBISH
HEAD OF WEALTH MANAGEMENT PRODUCT, U.S. BANCORP

WHY HER
Wimbish, a 20-year executive at Wells Fargo & Co., joined Minneapolis-based U.S. Bancorp in December. She lives in Charlotte while traveling to the 25 states in which U.S. Bank has investment offices. The company has about 620 employees at its Charlotte office, including investment-banking and bond-trading units, but no retail branches.


Why did you join U.S. Bank?

I left Wells last year after they had done some reorganizing, and I had an opportunity to take a package. I’d already known some folks at U.S. Bank and was asked to help with an initiative. That turned into a full-time job.

U.S. Bank is much smaller than Wells Fargo in wealth management. Is it easier to make changes?

We are committed to a growing wealth-management business, and we have a great platform to do that. We have a lot of upside, and we haven’t inherited a lot of problems.

One of the key wealth-management trends in the last two years is that lending solutions such as mortgages or financing big life insurance policies have become a key part of what many investors are looking for. That is a benefit that bigger banks can offer. Smaller registered investment advisers and stand-alone companies have a harder time with that.

What is a key issue for the wealth-management industry?

We’re just beginning to see the big wave of people retiring without a pension, and many of them are asking, who can help me to make my money last through retirement? This is a new, pensionless world. But it’s not something our industry has had to do on a large scale. There isn’t a lot of technology or a lot of education, so financial advisers need to step into that role.

You have said accumulating wealth is only half the story, right?

For those who have been good savers, the actual process of withdrawing money from savings is traumatic. People have been conditioned not to do that. But when you hit 67 and you need to supplement your income, it often becomes a necessity. It can be very difficult to get your head around that.

What is your view on cross-selling, which caused a scandal at Wells Fargo?

Our clear mission is to help our clients succeed financially, and if we do that well, our clients will select the right products and services. Advisers should never be driven by sales of a specific product or account.


GOAL FOR 2017

This is only the third company I’ve worked for in my career, so I’ll be spending most of 2017 getting my arms around U.S. Bank and learning how to be a better player in a new organization. That and a little more exercise.

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