JERSEY CITY, N.J., June 6, 2019 /PRNewswire/ -- According to a new
whitepaper, "Win. Grow. Retain. How to enrich your business with
smart liability management," released today by BNY Mellon's
Pershing ("Pershing"), advisors have a unique opportunity to
address the rapidly changing needs of affluent clients through
securities-based lending.
"Securities-based lending allows clients to quickly seize
opportunities and meet today's business and personal needs without
sacrificing tomorrow's goals," says Katie
Swain, director, Global Strategy & Product Management at
Pershing. "By expanding wealth management services to include
lending, advisors can make their business more comprehensive and
competitive—all while deepening relationships with current clients
and the next generation."
By definition, high-net-worth and ultra-high-net-worth clients
have enough assets to fund their lifestyles and meet their
financial goals. However, if they need to make large purchases, pay
a capital gains tax or invest in their businesses, selling their
investments can interfere with their wealth management plan,
carrying unintended consequences like taxes and opportunity
costs.
"Borrowing can enhance an investors' wealth management plan and
investment strategy, but this source of liquidity should come from
an advisor who understands their entire financial picture," adds
Swain.
Securities-based lending offers an effective approach, allowing
advisors and clients to:
- Enhance Value Proposition and Turn Prospects into
Clients: Providing resources for credit needs can differentiate
advisors from the competitors that are focused on the asset side of
the balance sheet. Centers of influence (COIs), such as CPAs, and
divorce and estate attorneys, may be more willing to refer clients
if they know liability management is offered—many of their clients
require ready access to financing for items like tax bills, divorce
settlements or real estate bridge loans.
- Grow and Strengthen Client Relationships: Discussing
securities-based lending with existing clients can provide two
opportunities. First, existing clients who need liquidity may be
encouraged by the conversation to consolidate assets in order to
qualify for a larger line of credit. Second, it allows advisors to
deepen client relationships by opening the door for new
conversations.
- Retain Assets and Clients: Providing alternative sources
of liquidity can prevent clients from selling part of their
investment balances and make assets difficult to unwind. Beyond
this, offering securities-based lending can help protect clients
from forming relationships with other advisors. According to
research from Aite Group, lending relationships, regardless of the
amount loaned, are the primary cross-sell channel for non-credit
products.
- Meet Unexpected Client Needs: Many wealthy individuals
are business owners, corporate executives, or hedge fund or private
equity partners. As a result, they may need a source of liquidity
for working capital, investment opportunities or unforeseen
expenses, positioning them to move as quickly as they need.
- Keep Long-Term Investment Strategy Intact: Selling
investments to generate liquidity can be costly in terms of
expenses and missed opportunities. Securities-based lending allows
clients to remain invested and continue to participate in
markets.
For more information on BNY Mellon's Pershing Lending Solutions,
please click here. To access the full paper, please visit
pershing.com/win-grow-retain.
About BNY Mellon's Pershing
BNY Mellon's Pershing and its affiliates provide a comprehensive
network of global financial business solutions to advisors,
broker-dealers, family offices, hedge fund and '40 Act fund
managers, registered investment advisor firms and wealth managers.
Many of the world's most sophisticated and successful financial
services firms rely on Pershing for clearing and custody;
investment, wealth and retirement solutions; technology and
enterprise data management; trading services; prime brokerage and
business consulting. Pershing helps clients improve profitability
and drive growth, create capacity and efficiency, attract and
retain talent, and manage risk and regulation. With a network of
offices worldwide, Pershing provides business-to-business solutions
to clients representing approximately 7 million investor accounts
globally. Pershing LLC (member FINRA, NYSE, SIPC) is a BNY Mellon
company. Additional information is available on pershing.com,
or follow us on Twitter @Pershing.
ABOUT BNY MELLON
BNY Mellon is a global investments company dedicated to helping
its clients manage and service their financial assets throughout
the investment lifecycle. Whether providing financial services for
institutions, corporations or individual investors, BNY Mellon
delivers informed investment management and investment services in
35 countries. As of March 31, 2019,
BNY Mellon had $34.5 trillion in
assets under custody and/or administration, and $1.8 trillion in assets under management. BNY
Mellon can act as a single point of contact for clients looking to
create, trade, hold, manage, service, distribute or restructure
investments. BNY Mellon is the corporate brand of The Bank of New
York Mellon Corporation (NYSE: BK). Additional information is
available on www.bnymellon.com. Follow us on Twitter
@BNYMellon or visit our newsroom
at www.bnymellon.com/newsroom for the latest company
news.
Sanuber Grohe
+1 201 413 2247
sanuberbilguvar.grohe@pershing.com
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SOURCE BNY Mellon