News October 27, 2023

Q3 Reports Show Growth for Retirement Sector Providers

Fidelity, Principal, T. Rowe Price and other firms with retirement sector business showed improved results compared with last year.

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Several financial services firms with divisions operating in the retirement sector reported third-quarter earnings and business highlights this week, with results showing general market and participant saving resilience.

Fidelity Investments, which is not publicly listed, released business highlights on Thursday that included a 20% year-over-year increase in assets under administration to $11.5 trillion.

The country’s largest recordkeeper also noted a 6% increase in workplace investing plan participant accounts, with 610,000 new accounts bringing the total to 43 million participants.

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That 6% growth was matched on the retail client account side as well, with 1.6 million new clients bringing the total to 38 million retail accounts.

Fidelity noted that 45% of those new accounts were opened by customers ranging from 18 to 35 years old. The financial services firm launched an app in September aimed to provide financial education and guidance to teenagers aged 13 to 17.

“Fidelity’s unique combination of businesses gives us the financial and operating stability to deliver resilient business results during both bull and bear markets,” Abigail Johnson, Fidelity’s chairman and CEO, said in a statement accompanying the report.

PRT Growth

Principal Financial Group, which is public, also released earnings on Thursday. The firm’s retirement and income solutions business reported a 30% sales increase in Q3 to $7.6 billion, including $600 million from pension risk transfer sales.

Operating earnings before taxes were also up quarter-on-quarter, by 48% to $304.7 million, according to the report. The firm’s asset management arm showed a less robust increase in pre-tax operating earnings of 7% to $222.4 million.

“Our diversified and increasingly integrated business model, as well as our industry-leading position in the small to mid-sized business segment, contributed to another strong quarter,” Dan Houston, Principal’s chairman, president and CEO, said in a statement. “We returned $356 million to shareholders during the quarter and remain confident in delivering our full year guidance.”

Aon, which also offers pension risk transfer services, noted a quarter-on-quarter increase in revenue from those services on Friday. The firm announced that its wealth solutions group saw “organic revenue growth of 4%” in retirement, in part from work related to pension de-risking, advisory demand and the impact of regulatory changes.

Managed Accounts Up

Morningstar Inc.’s Morningstar Retirement division, formerly named Workplace Solutions, added $2.7 million to the firm’s consolidated revenue growth for Q3, an increase of 10.8% quarter-on-quarter, according to the firm’s Wednesday earnings release.

Assets under management advisement grew 10.8% to $212.9 billion compared to the year prior, in part due to gains in the firm’s adviser-managed account offerings.

According to Morningstar, the firm is now offering managed retirement accounts to two of the 10 largest defined contribution retirement plans in the country with combined plan assets of almost $1 trillion, as of the end of 2022.

In a slide presentation accompanying earnings, the firm reported managed accounts as leading sales for the retirement division, followed by fiduciary services and then custom model collective investment trusts for retirement plan investment lineups.

On Friday, T. Rowe Price Group Inc. also reported its Q3 earnings. In the recordkeeper and investment firm’s quarterly filing, it showed target-date retirement products grew to $371.8 billion in the quarter, compared to $334.2 billion at the end of 2022.

“Our target-date products added another strong quarter, largely driven by our active security selection and differentiated portfolio construction,” Rob Sharps, T.Rowe Price’s CEO and president, said on a Friday earnings call. ”All vintages of the flagship retirement funds were in the top quartile versus peers, adding to their strong long-term track record.”

The firm’s recordkeeping division reported AUA of $234 billion, of which about $141 billion are assets the firm manages. That compares favorably with last quarter’s AUA of $206 billion, of which $125 billion was being managed by T. Rowe Price.

Deals & People October 27, 2023

Retirement Industry People Moves – 10/27/23

NAGDCA elevates Hiers to executive board president; Principal Asset Management hires Seaver as market director; Savvy Advisors recruits Most as principal wealth manager; and more.

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NAGDCA Announces Hiers as Executive Board President

Kelly Hiers

The National Association of Government Defined Contribution Administrators announced the elevation of Kelly Hiers to NAGDCA executive board president. NAGDCA is the premier professional association for plan administrators and services providers of government-sponsored defined contribution retirement plans.

Hiers currently serves as DC plans administrator at the Virginia Retirement System. She replaces Sandy Blair, the administrator for the California Savings Plus program, and is replaced as executive board vice president by Mo Raihan, the chief retirement officer at NYC Health + Hospitals.

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“We’re delighted to have Kelly helming the NAGDCA executive board,” Matt Petersen, NAGDCA’s executive director, said in a statement. “We look forward to continuing to work with her in her new position as she continues to share her extensive experience and insights in furtherance of NAGDCA’s efforts to support public sector plan sponsors.”

Principal Asset Management Hires Seaver as Market Director

Greg Seaver

Principal Asset Management has bolstered its investment product division, hiring Greg Seaver as market director in the investment-only division, effective October 9, a Principal spokesperson confirmed.

Seaver is responsible for selling Principal mutual funds, collective investment trusts, separate account and stable value products to retirement plan and investment consultants, institutional bank trusts, registered investment advisers and other defined contribution investment professionals in the Northeast.

He reports to Rob Logan, managing director for the investment-only unit at Principal Asset Management. Previously, Seaver was a vice president of DC investments at Hartford Funds.

Savvy Advisors Recruits Most as Principal Wealth Manager

Michael Most

Savvy Advisors Inc., a registered investment adviser affiliated with Savvy Wealth Inc., announced that Michael Most has joined the firm as principal wealth manager. He will leverage Savvy’s proprietary technology, lead generation capabilities and automated marketing support to further scale his practice.

Based in Fort Lauderdale, Florida, Most is the 11th adviser to partner with Savvy nationally.

“As an individual adviser at Savvy, I feel the possibilities are endless,” Most said in a statement. “I have access to cutting-edge technology that will allow me to enhance client satisfaction and streamline back-office tasks—all while enabling me to grow my practice exponentially.”

Most spent the last 10 years of his career working as a financial adviser and private wealth manager at LPL Financial, where he managed approximately $80 million in assets under management. Prior to his role at LPL, Most was a senior financial adviser at Ameriprise Financial Services. At Ameriprise, Most also worked as a training manager and district manager.

Kito Joins Fiduciary Trust International as Wealth Director

Kenneth Kito

Fiduciary Trust Co. International, a global wealth manager and wholly-owned subsidiary of Franklin Templeton, announced that Kenneth Kito has joined the firm as a wealth director, based in the New York office.

“New York and the surrounding markets comprise a vital region for our organization, and Ken is exactly the type of focused and talented professional we look for as we expand our office here,” Anne Fitzpatrick Donahue, regional managing director responsible for Fiduciary Trust International’s New York office, said in a statement.

Kito joins Fiduciary Trust International from its parent company, Franklin Templeton, where he served as territory specialist for retail U.S. distribution in Greater Philadelphia and New Jersey. He joined Franklin Templeton via its acquisition of Legg Mason Global Asset Management in 2020.

At Legg Mason, Kito held the position of assistant vice president of U.S. distribution and served as the dedicated point of contact for clients across the national wirehouse industry, as well as independent wealth management firms.

First Sentier Investors Expands Americas Team With Altman and Mazzariello as Sales Executives

Chase Mazzariello

Elizabeth Altman

First Sentier Investors, a global investment manager, announced it has expanded its distribution team in the Americas with the appointments of Elizabeth Altman and Chase Mazzariello, who report to Bachar Beaini, its New York-based regional managing director for the Americas.

“Elizabeth and Chase both bring significant business development experience to our team and will enhance our sales and distribution efforts as we raise the profile of the firm’s differentiated investment strategies in North America,” Beaini said in a statement.

Altman, a senior director, primarily supports Igneo Infrastructure Partners, the global unlisted infrastructure manager within the First Sentier Investors Group. Altman joined First Sentier Investors from Global Infrastructure Partners, where she was responsible for investor relations and capital-raising activities in North America.

Mazzariello, also a senior director, focuses on the investment brands and strategies of First Sentier Investors, including Igneo, Asia and emerging markets equity specialist FSSA Investment Managers, global listed infrastructure and global property securities. Mazzariello joined First Sentier Investors from Penserra Global Investors, where he was a partner and head of sales and distribution.

First Sentier Investors manages $137.8 billion in assets, as of September 30, for a global client base. In the Americas, First Sentier Investors manages more than $8 billion and employs a team of 48 people.

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