At a time when national and regional banks are having a hard time winning over customers for their wealth management businesses, fintech Ally Financial Inc. (ALLY) is getting kudos for its cross-selling successes.
That's according to a new study by Market Strategies International, which looked at the successes that national and regional banks are having in growing their businesses. According to the research firm, while it would seem like wealth management would be a natural extension for banks, less than 20% of the wealthiest customers would work with their main bank to access wealth management services and investment products. Market Strategies International polled 4,408 affluent investors with at least $100,000 in investable assets.
There are some exceptions, with Ally Financial, operator of Ally Bank and robo-advisor Ally Invest, getting accolades from customers. According to Market Strategies International, Ally Bank was among the top banks that customers would consider using for an IRA. Others to make the list include Citibank, Huntington Bank, Bank of America and Suntrust.
[Check out Investopedia's Charles Schwab review to learn more about this iconic broker with powerful charting tools.]
"Aspiring banks should focus on IRAs as the path to moving traditional banking customers into their wealth management businesses," said Julia Johnston-Ketterer, senior director at Market Strategies International and author of the report, in prepared remarks. "With nearly one in five affluent investors open to considering their primary bank for an IRA, focusing on IRAs over other traditional wealth management products would be an easier sell."
The research found that investors that are considering working with their primary banks are younger and are juggling multiple financial goals. The fact that those seeking investment services from their banks are younger plays right into Ally Financial's strengths. Ally Invest, which was created with Ally Financial's $275 million acquisition of TradeKing last April, is trying to become the fintech millennials want to do business with, just as its Ally Bank is aiming to be the de facto place for younger banking clients.
Now that TradeKing is integrated, Ally believes that it can bring on more millennial customers to use its online investing platform as well as its mobile bank. In November, Ally Bank announced that it had created an Amazon Alexa skill for its mobile banking clients. With this feature, customers can check their bank accounts via voice. While Alley Invest has not yet announced anything on that front, it is not a stretch to assume that the Alexa skill will make its way to Ally's online investing platform as well.