PENSCO-Lincoln Trust Merger to Create $10 Billion Alternatives Custodian

San Francisco-based PENSCO advisor network to expand with Denver-based Lincoln’s 6,000 advisors

PENSCO Trust and Lincoln Trust, two independent custodians of alternative assets, announced Tuesday that they will combine to create a new company called PENSCO that will have more than $10 billion in assets, 57,000 clients and operations across the country.

To be headquartered in San Francisco, where PENSCO Trust is based, the new PENSCO will expand its advisor network with the addition of 6,000 advisors who currently work with Lincoln Trust, which is located in Denver. The transaction, which is expected to close in March and is subject to regulatory review by state regulators, will make PENSCO the nation's largest independent custodian of alternative investments by assets, according to the companies.

Under the terms of the merger transaction, PENSCO has purchased all of the self-directed IRA accounts held at Lincoln Trust. Lincoln will remain an independent entity and continue to service corporate retirement plans such as 401(k) and 403(b) plans. The merged PENSCO will offer a range of alternative assets that clients can hold in tax-advantaged accounts to include investments in private equity, venture capital, start-up companies, real estate, notes and precious metals.

PENSCO CEO Kelly Rodriques“PENSCO is creating a firm with institutional scale and national reach to handle the accelerating growth of alternative assets across the U.S.,” said PENSCO CEO Kelly Rodriques (left) in a statement. "After a decade of poor stock market performance, investors and advisors are increasing their asset allocation to alternative investments to rebuild wealth.”

Rodriques noted that banks and broker-dealers are increasingly migrating alternative asset accounts to independent custodians that have special expertise to administer these complex assets. PENSCO is creating a seamless, integrated process that will let individual investors, financial advisors, plan sponsors, attorneys and accountants administer alternative assets.

PENSCO Trust, founded 22 years ago, helps investors build wealth in tax-advantaged accounts. The company’s services allow investors to hold alternative assets, such as private equity or debt, venture capital, start-up companies, real estate, unsecured notes, mortgages, foreign currency and precious metals.

Read Risk on the Rise: Yield Chasers Rush Into Alternatives at AdvisorOne.com

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