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Fiduciary Assets Trust Performance Report trust companies executive priorities assets revenue expenses A.M. Publishing peer comparison financial institutions trust banks Reliance Trust Bernard Garbo Trust Industry Breaks Seven-Year Streak of Increasing Revenues; Executives Cautiously Optimistic About 2020

(June 23, 2020 --Chicago, IL) -- The trust industry in 2019 broke a seven-year streak of increasing revenues, according to Trust Performance Report 2020, which annually surveys and reports on the activity of the top 1200 trust institutions.

Total industry gross revenues declined due to lackluster performance by the industry giants, Peer Group 1, institutions with more than $100 billion in total assets. A decline in revenue growth levels had been expected because going into 2019 fewer than 13 percent of institutions had indicated they would be raising fees. What was not expected, however, was the decline in revenues of the industry's largest institutions.

As a weighted average, gross revenues grew by of 3 percent, but this reflected the performance of institutions other than the industry giants.

Total trust-industry assets in 2019 grew by $16 trillion, or at a weighted average of 15 percent. This growth for the most part appears driven by spikes in the stock markets, given the low growth in the number of new accounts. New accounts grew by a weighted average of only slightly better than 1 percent when a spike in new accounts among Peer Group 2 institutions is excluded. Including this spike, the weighted growth rate for new accounts was 3 percent.

Profit margins generally improved as expense growth on average was less than that of gross revenues.

Productivity remained stable for most institutions, according to initial survey results. Most bank trust divisions and independents showed minor improvements; only national trust companies reported a decline. For more detailed information on productivity, see the Trust Performance Report's sister publication, Fiduciary Earnings & Expenses.

Cautious Optimism

Regardless of the generally poor revenue performance in 2019, trust executives, in A.M. Publishing/Trust Performance Report's 2020 survey, expressed optimism about raising fees in 2020. However, they also had higher levels of concern than in the prior year about meeting new account targets, as well as revenue goals.

While some are willing to raise fees, the number of institutions that offer trust services continues to decline, with many preferring to outsource operations or just exit the business totally. The astronomical asset increases at Reliance Trust, Atlanta, are an example of this.

Reliance's focus is on its servicing, or outsourcing, business. The trust company had just over $300 billion in total assets in 2017 but hit the magic trillion-dollar mark in 2019. This rapid growth in Reliance's outsourcing business suggests that many financial institutions continue to question whether to offer trust services.

Trust Performance Report/A.M. Publishing's annually surveys bank trust divisions and independent trust companies. The survey was conducted in March and April.

For sample pages of Trust Performance Report 2020, go to. for information on ordering, see below.

Trust Performance Report -- annual data book, published in May (June in 2020), 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 1200 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.

For Sample copies of both publications click here and then, on the web page, check "Trust Performance Report."

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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