RBC Correspondent and Advisor Services is now doing business as RBC Clearing & Custody. In addition to an updated logo reflecting the name change, the unit is being relocated to the new RBC Gateway building in downtown Minneapolis and updating much of its technology.
News of the RBC unit’s name change comes about two months after Raymond James decided to merge its investment advisor and custody & clearing businesses into the its newly created RIA & Custody Services Division. That move was announced in late September, about a week before Charles Schwab wrapped up its $22 billion purchase of TD Ameritrade’s RIA and DIY investor businesses.
For its part, RBC says it picked the new name to “better align with the primary focus of the business internally and externally and marks a new chapter in the company’s growth.” The name change became effective immediately and “will be implemented throughout the calendar year 2021,” it said Tuesday.
The custody business has been seen a buzz of activity beyond the Schwab-TD Ameritrade deal, with Morgan Stanley recently completing its purchase of E-Trade and Goldman Sachs moving last week to sell Folio Investments’ DIY investor business but keep the RIA custody operations.
The division’s name change was overdue “because the word ‘correspondent’ is an outdated bank term that doesn’t make sense in today’s advisor industry,” according to Tim Welsh, president of the consultancy Nexus Strategy. So it was “very logical to drop it and add in clearing to go after the broker-dealer market,” he told ThinkAdvisor.
This is a “nice strategic brand makeover for RBC to catch up into the fastest growing segment in financial services — independent advisors — and leverage the name change as a reason to go to market with a message that RBC is open for business and gaining momentum … ,” Welsh explained.
In comparison, Welsh had called Raymond James’ shakeup “a watershed moment” for that firm, when the news was made public this fall.
RBC’s clearing and custody unit does business with roughly 250 firms that work with 22,000 financial professionals managing some 700,000 client accounts.
RBC’s renamed business unit will be moved into RBC Gateway, a 37-floor landmark building set to house RBC Wealth Management’s U.S. headquarters and other businesses, including a Four Seasons Hotel. The skyscraper should be completed in early 2022.
RBC C&C also is planning “to transform its technology solutions to support clients,” the company said. “The updates will impact a range of technologies from the platform and tools used to the underlying infrastructure and data that drives RBC C&C’s technology overall.”
Explaining the tech strategy, Brett Thorne, head of RBC Clearing & Custody, told ThinkAdvisor by email: “With the support of, and investment from, the global RBC enterprise, RBC Clearing & Custody is in the third year of a five-year technology transformation strategy that will deliver a large-scale evolution of its technology stack.”
The firm is “building on” the success of its RBC Black workstation and will roll out new technology for client firms (such as RIAs and broker-dealers) and financial professional in 2021, Thorne said. “This new experience includes a new advisor platform and workstation, a new digital account opening solution and a new performance reporting solution.”
The tech “transformation includes an improved end-investor experience through new mobile and web portal capabilities that introduce a more intuitive navigation and more client self-service functionality with the end-goal to make more services & information available to clients on the go,” the executive explained.
Also in its Tuesday announcement, RBC C&C stated that it’s “growing and evolving like its name.” It also stated that “in the last five years, revenue and assets under management are up over 100% as the business continues to attract more broker dealers and RIAs to the platform.”