Pershing is soaring. The RIA Custodian raked in $12 billion in new assets in the third quarter, according to BNY Mellon’s earnings. It’s likely that a good portion of that is due to incoming RIAs. Approximately 50% more RIAs have signed on with the custodian in 2020 than in 2019.
“We've got plans to do more and to continue capturing market share,” CEO Todd Gibbons said Oct. 16 on the company’s third quarter earnings call with analysts.
BNY Mellon is optimistic about the RIA industry and has been ever since it invested an additional $50 million into the RIA segment of Pershing’s custody division in 2018. “The advisory business is growing rapidly, and we think we can capture more of that,” noted Gibbons, while pointing towards industry consolidation as an area of opportunity.
This year alone, three major brokerage deals have closed. Charles Schwab purchased TD Ameritrade, while Morgan Stanley acquired E-Trade and Goldman Sachs bought Folio Financial.
The bank’s asset management unit introduced its first ETFs earlier this year, which began offering a pricing incentive for RIAs who use BNY Mellon’s eight ETFs in client portfolios. Not even a year later, the ETFs have collected more than $274 million in assets.
Pershing recently lowered its target market of RIAs, dropping its threshold to advisory firms with $100 million in assets.