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Assets Rank Banks Income Trusts Performance Report Fiduciary Benchmarks News Fiduciary Revenues Set New Record

(June 9, 2009--Chicago, IL) -- Fiduciary revenue in 2008 set a new record, even as asset values plummeted, according to Trust Performance Report 2009, a sister publication of TRN. However, most institutions did not see revenue growth.

While performance results for 2008 were disappointing for most institutions, they were tempered by 6 years of aggressively seeking new business and raising fees. For 2008, fiduciary assets declined 16 percent while revenues were up by 2 percent. However, this performance reflects results for peer group 1 institutions, those with more than $100 billion in assets, which skew industry averages. When weighted, industry averages continued to show a decline of 16 percent for assets, but a clearer picture of revenue performance emerges: down by 4 percent. Over the last six years (2003 through 2008), fiduciary institutions have had average annual asset growth of 14 percent, with annual revenue growth of 6 percent.

While 2008 was more than a bump along the road, fiduciary institutions seemed poised for continue growth, especially on the revenue side.

Fiduciary Earnings & Expenses, a sister publication of TPR, reports that only a quarter of bank trust divisions, primarily larger institutions, charge fees equivalent to independent trust companies. On average, most bank trust divisions charge less than a fifth of what independents do. Banks have been taking note. In 2007, 24 percent of institutions raised their fees, followed by another 20 percent in 2008. For 2009, some 30 percent of institutions say they expect to raise fees.

Regarding asset performance, one of the more surprising trends noticed over the last six years is the aggressive push for growth among peer group 5 institutions, those with less than $500 million in total fiduciary assets. Their performance supports survey feedback that smaller institutions are being pressured by their boards of directors and by regulators to become profitable operations or consider outsourcing their fiduciary activities.

For more performance and benchmark data see Trust Performance Report 2009. For information on ordering TPR2009 Click Here.

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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