The consensus among DC industry consultants, executives and
experts is that record keeper consolidation will continue, driven by rising
technology costs, lower fees and increased intellectual capital needed to
remain competitive. The prognosis is for fewer providers — which will result in
higher fees and worse service.
In a P&I article this month, Callan said that its
clients used 40 record keepers in 2006 but just 26 last year. The number of
national DC record keepers servicing all markets is now 42, according to NAPA’s National
401(k) Record Keepers list. Industry consolidation has sped up in 2014,
with six deals already — matching all of 2013.
The providers which are best positioned are those that can
cross-sell other services like proprietary funds, including TDFs, TRFs, stable
value and managed accounts.
for the full article at NAPA Net.