Trust Updates Archive

Trust revenue officer concern 2014 2015 trust regulatory news a.m. publishing trust companies banks Bernard Garbo Under Pressure to Grow Revenues, Trust Executives Respond

(May 20, 2015 --Chicago, IL) --Almost 80 percent of trust executives say their greatest concern is meeting revenue and income goals, according to Trust Performance Report 2015, issued May 18. This is the second highest level since TPR began surveying trust executives in 2007. TPR's Annual Survey of Trust Assets of 1500 trust institutions was conducted in March 2015. Prior to 2013, meeting new account targets was officers' primary concern.

In response to this heighten concern, the trust industry raised fees and better policed their fee schedules.

In 2014, more than one in five trust institutions raised fees, according to TPR 2015. The prior year, three in ten indicated they planned to raise fees. In other words, approximately 75 percent of those forecasting a fee increase followed through in 2014, a relatively high rate. In 2015, 20 percent say they expect to raise fees.

As a result, revenues grew faster than assets in 2014. Trust executives were also able to keep expenses in check (increases were below revenue rates and lower than in prior years), resulting in net profit per asset dollar also increasing.

Raising fees, however justified, still makes many trust bankers nervous. This may be why over the last three years more and more respondents say their focus is on policing fee schedules to ensure full implementation of their existing fee schedule

The prioritization on revenue may reflect the commercial banking industry’s increasing focus on generating higher revenues from fee-based business lines, rather than from interest income.

To view sample pages of Trust Performance Report 2015, Click here.

For more detailed information see the upcoming issue of Trust Regulatory News.

Trust Performance Report -- annual data book, published in May, provides both industry and peer group performance data by assets, gross revenue, net income, and account category. Subscribers receive quarterly updates. TPR findings are based on its annual survey of the top 1500 fiduciary institutions. For more best practices and benchmark data see TPR. For information on ordering click here or the link below.

Fiduciary Earnings & Expenses -- annual data book comparing performance among independent trust companies to that of OCC national trust companies and to bank trust divisions. For information on ordering click here or the link below.

No statement in this issue is offered as or should be construed as legal opinion or advice or as an indicator of future performance.
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