Bank of America and Wells Fargo are the most popular primary banks among affluent investors, a new report shows.
According to the annual survey by Spectrem Group, a combined 32 percent of investors with a net worth between $5 million and $25 million prefer Charlotte-based Bank of America and San Francisco-based Wells Fargo over other financial institutions.
New York-based JPMorgan Chase & Co. came in third place, with 11 percent of affluent investors preferring it as their primary bank.
The findings are surely good news for Bank of America CEO Brian Moynihan and Wells Fargo CEO John Stumpf. That's because both banks have been targeting "mass affluent" customers, pushing to sell more products and services at a time when revenue growth for the banking industry overall remains weak.
For example, Bank of America this summer announced a new rewards program as part of Moynihan’s strategy to expand the bank’s relationship with its roughly 8 million mass-affluent customers, meaning those with $50,000 to $250,00 in assets. Bank of America has also been adding employees in its branches to work with such customers, which the bank refers to as its “preferred banking” clients.
Wells Fargo's efforts to increase its business with the mass affluent include a new credit card that offers rewards to world travelers. The bank unveiled the Propel World credit card in May. It is accepted on the American Express network.
According to the Spectrem Group report, the wealthiest of wealthy investors are more likely to pick name-brand institutions for their primary banking services: Among investors with a net worth of $15 million to $25 million, 20 percent use Wells Fargo; 17 percent, Bank of America; 12 percent JPMorgan; and 7 percent, Citibank.
Some other noteworthy findings from the report:
- The youngest affluent investors prefer Wells Fargo as their primary bank. Of investors under the age of 48, 20 percent chose Wells.
- Older affluent investors gravitate to Bank of America. Of investors over 64, 18 percent chose the lender. Of affluent investors between the ages of 48 and 54, JP Morgan and PNC Financial Services group each had 15 percent.
- Wells Fargo was not as popular among affluent investors as it was in the 2013 report, when 20 percent chose it as their primary bank.
- But Bank of America grew in popularity from the 2013 report, when 14 percent of investors chose it as their primary bank.