One of the newer brands in US wealth management – albeit part of a long-established firm in US banking history - is Ascent Private Capital Management of US Bank.

One of the newer brands in US wealth management – albeit part of a long-established firm in US banking history - is Ascent Private Capital Management of US Bank. Last October, this publication met some of the staff at the firm’s San Francisco offices and has tracked Ascent’s progress in recent months, including its opening of new offices across the country. Here, Michael Cole, president, answers questions about its development to date, its future strategy and opinions on the challenges in the present marketplace. We are grateful for the firm for taking the time in setting out these answers.

The background and recent developments?

US Bank has been in the wealth management business for more than 100 years, but about five years ago, US Bank Wealth Management launched a strategy to provide US Bank private clients with differentiated service-delivery models depending on their specific needs. This resulted in the formation of three distinct business lines, each catering specifically to different segments of the wealth market - affluent, high net worth, and ultra high net worth. The affluent and high net worth business lines were launched first.

Then, in July 2010, US Bank Wealth Management hired Michael Cole from Wells Fargo to build out the ultra high net worth division. In April 2011, a new brand - Ascent Private Capital Management of US Bank - was launched and the first two Ascent offices in Minneapolis and Denver began operations in November 2011. Two additional offices in Seattle and Cincinnati were opened in 2012. Another office in San Francisco will open in 2013.

Ascent was established to provide ultra high net worth clients with innovative and highly personalized services designed specifically for their unique and complex needs. The services integrate traditional wealth management offerings - financial planning, investment management, private banking, personal trust and estate administration services, information management and financial administration. [This included] cutting-edge “wealth impact” planning and communication services that may help families of wealth in the areas of family dynamics, family governance and risk management, multi-generational wealth transfer with education and preparation of heirs, leadership and communication assessment, strategic planning, education, stewardship and philanthropy.

What would you say is the core business of Ascent?

Ascent’s core business is to help clients with significant resources focus on both managing their wealth along with managing its impact. We believe this approach is the key to preserving wealth over generations. Using highly differentiated services, Ascent works with clients and their advisors to address a range of issues that help them achieve their wealth-transfer goals and establish their legacies for this and future generations.

Recognizing that “wealth is more than money,” Ascent offers a comprehensive platform for supporting families to both manage wealth as well as manage the impact of wealth on the key constituents that matter to them. The wealth impact planning platform includes wealth dynamics coaching (comprised of family dynamics, family communication, legacy planning, family governance, responsible wealth ownership, philanthropic strategies, reputation management, etc), family meetings and retreats, educational forums and workshops, and tactical wealth planning. This approach deeply enhances the potential for client success, long-term stewardship, and wealth impact.

How does Ascent fit into the wealth management market – what sort of position does it aim to hold and niche does it fill?

Ascent has taken a highly differentiated approach to the ultra high net worth market, focusing on “impact investing,” which places an emphasis on helping families of wealth drive positive change in the world.

This isn’t just about philanthropy, or giving away money. This is about investing in ways that are consistent with a family’s long-term values and that have the ability to accelerate change. At Ascent, we are providing access to the tools that will help our clients achieve this goal while also acting as responsible stewards for preserving wealth across the generations. 

Using highly differentiated services, Ascent works closely with clients to address a range of issues to help them achieve their wealth-transfer goals and establish their legacies for this and future generations.

What type of client does Ascent focus on?

Ascent provides advisory services to individuals and multi-generational families with significant resources (typically in excess of $50 million) who may have private businesses and foundations and who aspire to making an impact on their communities and the world at large.

Do the bulk of Ascent clients come from US Bank; is there a significant external client inflow and is this going to grow?

The bulk of Ascent initial clients came from US Bank, and the inflow of external clients is continuing to grow.

What are the main requirements of Ascent’s clients? What sort of trends do you see?

Ascent clients require a broad range of services – from traditional wealth management services - financial planning, investment management, private banking, personal trust and estate administration services, information management and financial administration - to “wealth impact” planning and communication services that may help them in the areas of family dynamics, family governance and risk management, multi-generational wealth transfer with education and preparation of heirs, leadership and communication assessment, strategic planning, education, stewardship and philanthropy.

The US is in the midst of one of the largest wealth transfers in history - estimated to exceed $40 trillion that will transition from one generation to another by 2050. 

Nearly 65 per cent of this wealth – $27 trillion – will come from ultra high net worth families, which represent the top seven per cent of estates by value. (Source: Boston College Centre on Wealth and Philanthropy, 2003.)

Among this group, there has traditionally been a 70 per cent wealth-dissipation rate in wealth transfers to the third generation and beyond. (Source: Roy Orville Williams and Vic Preisser, Preparing Heirs: Five Steps to a Successful Transition of Family Wealth and Values, 2003.) 

This dissipation rate has typically been caused by a lack of communication among family members and inadequate preparation of the next generation, among other things. Ascent Private Capital Management seeks to differentiate itself by helping address these issues for ultra high net worth families.

Your firm currently oversees over $5 billion of client money. How scalable is this business in terms of its growth?

The business is quite scalable in terms of growth.

Besides the US Bank relationship, how else do you reach out to new clients in terms of intermediaries, word of mouth recommendations, networks, and so on?

Through referrals from current clients and centers of influence (such as lawyers, accountants, etc).

What are the most difficult issues that your firm typically has to grapple with?

Marketplace awareness; differentiation

Investment markets; economy

Managing client relationships

Technology; reporting

Regulation and compliance

Obtaining scale; efficiencies

Do you get many clients who have left other banking relationships?

We are continuing to see more and more clients coming to us from other financial institutions. In many cases they are introduced to us by existing Ascent clients. Prospects are becoming aware of our highly-differentiated approach in the area of investment consulting and family education services. Additionally, clients are pleased with our lending practices as well as our timely reviews and timely responses to lending requests. 

How do you promote your brand? How would you describe your strategy for raising awareness of it?

The Ascent brand is promoted through events hosted for prospects and centers of influence at Ascent offices; through participation in meetings and events sponsored by industry trade associations (eg VIP Forum, Heckerling Institute, etc); through networking in the ultra high net worth market space; through thought leadership (white papers, media interviews, etc); through sponsorships; through proactive media outreach; through presentations given by Ascent leaders at industry conferences, seminars, etc; and through a limited amount of advertising.

Looking ahead for the next five years or so, what do you see as the main issues for your firm and this industry as a whole?

Market place awareness; differentiation

Investment markets; economy

Managing client relationships

Managing growth

Regulation and compliance

Competition

Business development

Obtaining scale; efficiencies

Does your firm deal with non-US clients or US clients with significant overseas assets and businesses? Do you have to deal with significant cross-border issues?

No, not at this time.