Administration February 3, 2010

Banks Capturing More IRA Rollovers from HNW Clients

February 3, 2010 (PLANSPONSOR.com) – A new research report indicates that banks are capturing more retirement plan rollover assets from affluent investors.
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A news release about the report from BAI Research and Financial Research Corporation (FRC), 2009 Retirement Study: Capitalize on Market Opportunities, said banks snapped up 33% of the IRA rollover market in 2009, up from 23% in 2008 and 18% in 2007.

That compares to investment firms, which captured 57% of the IRA rollover market in 2009, down from 63% the year before, and insurance companies, which grabbed 9% of the rollover assets in 2009, the same as 2008. The data covers more than 2,500 mass affluent individuals between 35 and 70 years old with investable assets of at least $50,000, excluding defined contribution plan assets.

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The report also indicated that overall wallet share capture among customers with a retirement relationship (76%) for banks denoted as the customer’s primary bank, is consistently and significantly larger than that of customers without such a relationship (26%).

Orphan 401(k)s remain an obvious opportunity with $1 trillion up for grabs and 35% of mass affluent consumers holding an orphan 401(k) account in 2009, the announcement said.

“Going forward, banks and other financial institutions that are able to maintain compelling product offerings and services that are aligned with changing market conditions and investor preferences will be better positioned to retain and grow their marketshare,” said Bruce R. Fador, CEO of Financial Research Corporation, in the news release.

The online survey used for the report was conducted among a nationally representative sampling of consumers by Bellomy Research, Inc.

Products February 3, 2010

Hartford Expands 403(b) Offering to TPA-serviced Plans

February 3, 2010 (PLANSPONSOR.com) - The Hartford Financial Services Group, Inc. is expanding its product offerings to include ERISA 403(b) retirement programs for nonprofit organizations serviced by third-party administrators.
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The Hartford’s PASSport program, which provides administrative and recordkeeping services to 401(k) plans through TPAs, is being expanded to include 403(b) retirement plan sponsors with less than $5 million in assets under management, according to a news release.  The Hartford’s Premier Innovations 403(b) retirement program – which allows plan sponsors to select from more than 200 investment options from more than 40 fund complexes – is available in this market. 

As a result, The Hartford said, it will work with a nationwide network of nearly 200 third-party administrators, many of which currently partner with The Hartford to service 401(k) plans. 

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“The PASSport program makes a broad range of localized services available to 403(b) plan sponsors and positions us to continue our momentum in this market,” said Peter Moore, vice president of The Hartford’s public sector retirement sales, in the announcement.

Moore pointed out that an increasing number of nonprofits are expected to seek help from TPAs, as new rules for 403(b) plans are making it necessary for nonprofit institutions to enhance their administrative capabilities.

More information is at http://www.thehartford.com.

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