Banks Increasingly Catering to Mass Affluent

Banks are increasingly targeting the “mass affluent” – people who have hundreds of thousands of dollars worth of assets. There are approximately 20 million people in America who have assets between $100,000 to $1 million. Banks want to sell more mutual funds, stocks, and retirement advice to these individuals who typically only use the bank for checking and savings accounts. There are less government regulations on accounts for the affluent, and the accounts would bring in more funds to the bank than those of ordinary savers. Bank models are shifting to offering amenities geared towards the mass affluent groups, attempting to lure them in with wine and cheese opening parties, private settings, and fancy décor.

JPMorgan opened 246 Chase Private Client locations last year and plans to add 750 more sites throughout this year. Bank of America and Citigroup are adding private rooms and financial solutions advisers in their existing branches to reach out to the mass affluent. Smaller banks are also shifting their focus to this group of affluent as well. First Republic is a smaller bank that is building branches in the most upscale San Fransisco areas. Their offices do not have tellers; they have relationship managers who clients can consult with. Most of the banks have been sure to clarify that they are working on improving services for all customers, not just the affluent. Naturally though, there are rewards for those who do more business with the bank.

See Nelson D. Schwartz, Got $100,000? Have a Cookie: Banks Try Luring the Top 10%, The New York Times, Mar. 10, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.