With enCircle, a service aimed at simplifying life for the elderly and their children, Harris Private Bank has found not just a potential new revenue stream, but possibly a new way to attract and retain assets as well.
The private bank, the wealth management arm of Bank of Montreal's Harris Bank of Chicago, rolled out enCircle last week. It will provide day-to-day management of finances, tax preparation coordination, and health-care expense management for the elderly or the adult children who care for them.
Managed portfolio clients receiving enCircle services will pay a fee of 0.85% to 1.55% of assets a year, said Debbie Korompilas, senior vice president and head of trust and estate services at Harris Private Bank.
Alois Pirker, a senior analyst at the research firm Aite Group LLC, said enCircle could help Harris pull in new clients — and their assets — and could help ensure that when children inherit their parents' assets, those assets remain within the bank. "That transition period is a huge period of risk for most banks," Mr. Pirker said. "I think this is a really smart move."
Ms. Korompilas said enCircle has been a success in Canada, where Bank of Montreal has offered it for more than three years.
Bank of Montreal clients have commented that the program lets them "enjoy time with parents in a more meaningful way," she said.
Bank of Montreal has begun offering it to executives with "busy lives," Ms. Korompilas said.
With a growing number of baby boomers retiring and caring for their parents, Harris expects strong demand for enCircle both from older clients and their children, she said. "We know there is a need for it. Our clients have told us, and research has told us, that there is a need."
One scenario in which enCircle could gain a customer would be a holiday visit where grown children realize their parents "have some diminished capacity, they're not addressing their finances, and they need help," Ms. Korompilas said.
Harris would provide a range of services to such clients, all through a single contact person.
That would be valuable, for instance, in cases where an elderly person or their caregiver has to coordinate investment portfolios spread among several providers, Ms. Korompilas said.
The clients would also get access to the reassurance and guidance of an expert, she said. For example, they will be able to review business letters they have received with the contact person, though the program leaves decision-making power in the client's hands.
Harris is offering the service nationally but focusing on its offices in Illinois, Washington State, Arizona, and Florida.
The bank is drawing its enCircle specialists from its trust department. Trust officers, attorneys, financial planners, and others are receiving training from a new advisory board and care management groups, Ms. Korompilas said. "We brought in a trainer on senior issues, including physical, psychological, spiritual, and emotional." The advisory board includes a gerontologist, a geriatrician, and an elder-law attorney; they "help us round out our financial expertise," Ms. Korompilas said.
Analysts said banks have long provided concierge services, including some services of the sort offered through enCircle. But they have typically been available to only their wealthiest clients.
Harris, on the other hand, is offering enCircle to all its private banking clients, a group that includes individuals with investable assets as low as $1 million, Ms. Korompilas said.
Mr. Pirker said a key question for Harris is whether clients will conclude that enCircle provides the convenience and peace of mind to make the fees worthwhile.
In creating the program, Harris formed relationships with health-care management providers to help older people assess their options, such as the decision to remain in their homes or move to a continuing-care facility, Ms. Korompilas said.
