Fidelity Institutional ended 2012 with record level of assets

Firm's RIA chief pegs 21% increase to investor interest in independent advice.
FEB 26, 2013
Fidelity Institutional Wealth Services attracted record levels of new assets to its platform last year, according to the company, ending the year with $608 billion in assets under administration for 3,300 institutional clients. Such assets rose 21% over 2011. Net new assets were nearly one and a half times higher than in 2011, firm officials said. Mike Durbin, head of Fidelity's registered investment adviser custody unit, chalked the performance up to “a secular momentum in the independent space.” Fidelity runs second, behind Schwab Advisor Services, which finished the year with $788.5 billion in assets held for nearly 7,000 advisers. The numbers aren't directly comparable because Fidelity counts assets held for banks and third-party administrators. And privately held Fidelity doesn't break out net new assets or the number of pure RIA breakaways versus hybrid advisers landed by its correspondent broker-dealer firms. Fidelity's National Financial Services LLC is a major player in clearing. At the RIA unit, Mr. Durbin said growth came across the board, with much of it coming from Fidelity's existing adviser base. “Increasingly, end-consumers are alert to the merits of an independent provider” and are seeking out RIA firms, he said. Separately, this week, Fidelity released results of its annual adviser benchmarking study , based on a survey of more than 300 firms last summer. Results showed that the top 25% of firms ranked by performance were more selective in their service offerings. Most advisory firms offer financial and retirement planning, but fewer top firms offer estate/trust planning, philanthropic planning, insurance planning or tax planning. Top-performing firms also charge higher fees across the board, for all client sizes — a median of 100 basis points on a $2 million account, for example, versus 95 basis points by all other firms, and just 82 basis points by firms with less than $50 million under management. “Our experience shows that those [top] firms are so strong and so successful, they do not seem to be feeling the same secular downward pressure on fees that we read about,” Mr. Durbin said.

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