Citizens Financial Group Inc., the Providence, R.I., arm of Royal Bank of Scotland Group, says it will aggressively expand its wealth management businesses as some competitors contract.

Mike Millard, president and chief executive of the wealth unit, said the company added 40 relationship managers in its premier banking segment in Boston in recent months and will add about 40 more next year in Philadelphia, Rhode Island and Connecticut.

"We are not going to cover a 12-state footprint with 80 people," he said in an interview. "It is going to require more people, and how many will really depend on how quickly we grow this business."

The company has "aggressive plans to grow" in all its wealth management businesses, Millard said Wednesday.

Citizens Wealth Management also increased its broker-dealer sales force 20% this year and plans to add 10% to 15% next year, he said, declining to specify. The private banking business will grow "by multiples" next year, he said, and he wants to continue improving its asset management capabilities and institutional sales force.

"There isn't a client-facing or investment area that we don't have plans over the next 13 to 14 months to grow," Millard said. "I understand that many competitors have pushed back, and I think that that has given us an opportunity to attract people that we couldn't have attracted 18 months ago. There are a lot of talented individuals that companies have been forced to cut back."

On Wednesday, Citizens Financial, which has $153 billion of assets overall, announced that it had hired two executives from Bank of America Corp. — Thomas P. Fay as chief investment officer and director of wealth management services and Brian O'Connor as a senior vice president and head of relationship management for the premier banking business, which targets mass-affluent customers.

Fay, 48, was a managing director at U.S. Trust/Bank of America Private Wealth Management in Boston. O'Connor, 49, was a northern New England regional executive for premier banking and investments at B of A.

Analysts said smaller financial services companies with a strong local presence, like Citizens, are beginning to gain share.

"I think the issue for these larger banks is that they have an inability to maintain personal contact with their customers," said Geoffrey Bobroff of Bobroff Consulting in East Greenwich, R.I. "A local company is more apt to be successful because customers have the opportunity to kick the tires, so to speak, … and by hiring key people away from larger competitors, it only helps. You stand to gain at least that book of business."

Millard said Citizens is not hiring just to gather assets from larger competitors.

"You hire these folks for the people that they are, not for their books of business," he said. "We want these hires to be counted in billions of dollars, not in a few dozen relationships. It would be pretty short-sighted if we were hiring executives just to get a handful of assets and a book of business."

Fay said he was attracted to Citizens by the way it was investing in its wealth management business despite the recession.

Citizens wants to use its new corps of relationship managers to cross-sell, Millard said. To do this, it must do a better job of serving all its customers, he said, "whether they require trust services, estate planning or brokerage services."

"Clients are willing to do more with us," he said. "I know a lot of people in the financial world are saying, 'Isn't this an odd time to do this because of the economic climate?' But I think this is really the only time to do this. Wealth might have declined in the past year, but people's goals are the same. They want to retire. They want to transfer wealth. The only thing that has changed is that the financial plan needs to be adapted."

Relationship managers will work with customers and can then bring in a team of specialists depending on a customer needs, he said.

"We want to be in a position where we can solve anything from a checking problem all the way up to an estate issue," Millard said.

He said he expects "explosive" growth in assets under management during the next three to five years. (He would not specify a percentage or say how much in assets the wealth management unit manages.)

Bobroff said that local institutions are expanding in New England and that Citizens, through its hiring, can capitalize. "Wall Street and large national banks are going though a pruning process, and this has created a real opportunity to pick up talent," he said. "This is all a part of the rebirth of the market that has been devastated for the past 18 months."

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