With its recent acquisition of CitiStreet LLC, one of the largest providers of retirement plans and benefit services in the U.S., ING Group is set to become a heavyweight in the retirement services industry–an area that Rick Mason, the president of ING U.S. Wealth Management’s retirement services market, believes is set for great growth going forward.
“We are focused on being a long-term market leader in retirement services as this is a key focus for ING globally,” Mason says. “We’re really in a position to grow and expand and with the acquisition, our value propositions will greatly increase in the small-, mid-, and large-size corporate space, as well as in healthcare and education.”
With CitiStreet under its belt, ING becomes the third-largest player in the defined contribution business and the second largest in the number of plan participants it services. Following the $900 million CitiStreet acquisition, ING will have $351 billion in assets under management and assets under administration and it will be serving more than 14 million plan participants.
The combined entity will be able to focus on looking at “total ideas” in the retirement finance area, says Sandy McCarthy, president of CitiStreet, particularly in the small- and mid-sized corporate arena, as this is where the greatest demand for defined contribution plans is likely to come from in the near-term. Companies in these segments are looking for functionality and for retirement plans that are consistent with what their larger peers enjoy, McCarthy says. ING/CitiStreet, with the volume of business it already has, its extensive distribution network, and its penetration into the smaller end of the corporate space, will be in a position to offer them that.
But even if the defined contribution business is the primary goal of both ING and CitiStreet, the combined company, McCarthy says, can still play a key role in the defined benefit space. The trend is to phase out DB plans, but there are still plans around that need to be administered for which CitiStreet has the capability, she says. Sponsors are also revisiting DC plans as they freeze DB plans and they need help in enhancing those DC plans to make them more attractive, she says, which is where ING can help.