Fidelity adds $37.2B in defined contribution assets but pace slows

With addition of nearly 1,100 retirement plans, firm's assets under administration for DC plans reaches $1.4T

Jul 22, 2014 @ 12:32 pm

By Darla Mercado

retirement, assets under administration, defined contribution, fidelity, assets, plan sponsors, retirement plans
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(Bloomberg News)

Fidelity Investments scooped up $37.2 billion in assets under administration during the first half of the year, bringing on some 1,093 new retirement plans.

The new sales raised Fidelity's assets under administration for defined-contribution plans to $1.4 trillion, according to Steve Patterson, executive vice president of sales at Fidelity.

The amount of new assets is down slightly from the $40.5 billion it picked up during the first half of 2013, he added.

Although Fidelity brought on some very large companies very recently, including supermarket giant Bi-Lo Holdings, the firm's DC sales aren't necessarily driven by one particular corner of the plan market, Mr. Patterson said.

(See also: Fidelity and Credit Suisse team up for easier access to IPOs)

“Fidelity is one of the few providers that competes in every segment of the DC marketplace from the smallest emerging corporate business to the largest Fortune 500 companies and the tax-exempt marketplace,” he noted. Advisers have helped drive business with smaller employers, such as the Akron Steel Treating Co., a retirement plan with only 29 participants.

(Related: Retirement savers' fund fees move lower: ICI)

Mr. Patterson added that plan sponsors have become more discerning, seeking additional services from their service providers. Plan design and participant education are some of the major areas of focus for employers as they seek analytic tools to track participants' saving behaviors and features that will ease the plan enrollment process. Indeed, Fidelity bolstered its capabilities in both departments by adding Executive Insights, a plan analytics tool that helps sponsors gauge how a plan is performing, and Easy Enroll, a program that guides workers toward choosing an appropriate savings rate and allocation based on age and risk appetite.

“It reflects a need from the plan sponsor community perspective,” said Mr. Patterson.

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