Other vendors, including SEI and EnvestnetPMC, offer soup-to-nuts solutions similar to FundQuest’s. The goal is to help smaller banks compete in an area that is expected to register sharp gains in both volumes and fee generation over the next few years. “We’re seeing a tremendous migration by smaller institutions into the fee-based wealth-management business,” says FundQuest CEO Bob Del Col. “But in order to be successful, they need to offer the same choices the big guys offer. We help them do that.”

wfabbFee-based products aren’t for everyone, says Kyle Farris of the NYeC Regional Extension Center. Many banks lack the sales culture, customer base and organizational and compensation structure to accommodate such offerings. Others may be uncomfortable sharing vital customer information with a third party. “You’re talking about giving up total control of the investment management process,” Del Col says. “Some banks have a difficult time with that idea.”

Rachel Malatesta, an analyst with Cerulli Associates, says bank efforts are hindered by a lack of commitment. Only three percent of banks offering investment