Placemark Investments Inc. has introduced a next-generation unified managed account platform, but a top executive says it falls short of what the company wants the product to be eventually.
The Wellesley, Mass., company, one of the largest overlay managers in the industry, introduced its first unified managed household platform last week.
Randy Bullard, the executive vice president of business development for Placemark, said the customized income management program links multiple accounts, but not across multiple financial institutions.
"Right now it is impossible to link multiple accounts from multiple banks with one investment process," Mr. Bullard said in an interview last week.
"Ideally, we'd like our UMH platform to be multibank, but right now there is no way to integrate it completely. It just isn't possible," he said.
Analysts said Placemark's platform's strengths include household-level planning, integrated performance reports, and an incorporated investment management process.
"Other companies think that they have UMH platforms, but really it is just a glorified UMA," said Alois Pirker, a senior analyst with the Boston research firm Aite Group LLC.
Wealth management executives began discussing this type of unified managed account three years ago. Like other unified managed accounts, the household version offers a collection of investment products on one platform, including separately managed accounts, mutual funds, and exchange-traded funds, but it also links people who live in the same household on to a single platform.
The platforms are intended to let advisers rebalance, allocate, and deliver performance reports for multiple investment accounts.
Placemark expects its new platform to be available to customers by early this summer.
There is some early interest from Placemark's banking customers, which include Bank of Montreal, Royal Bank of Canada, and UBS AG, he said; the majority of his firm's customers are broker-dealers.
"The bank market is usually very slow to adopt any sort of new platform," Mr. Bullard said. "We are seeing a lot more of a response from broker-dealers. Bank adoption tends to lag behind by a year or two."
Most banks are still getting comfortable with the idea of providing open architecture, he said.
Placemark's platform is designed to distribute assets that have been accumulated in multiple accounts in a tax-efficient manner after a couple has retired. Mr. Bullard calls it the first "true unified managed household product," because it fulfills the Money Management Institute's three-pronged definition.
The Washington trade group, which tracks separately managed and unified managed accounts, said that to be considered a unified managed household platform, a unified managed account must provide household-level investment planning, integrated performance reports, and household-wide investment management.
"It is important as individuals approach retirement not just to try to sell them different products, because suddenly they need to begin thinking about distribution," Mr. Bullard said.
Placemark has gradually developed into a leading overlay management provider.
One of its main competitors is Parametric Portfolio Associates of Seattle, whose unified managed account platform is used by Bank of America Corp., among other companies.
Other companies offer unified managed accounts but Mr. Bullard said that Placemark and Parametric, unlike most other competitors, provide overlay management that can be fitted with a bank or broker-dealer wealth management platform.
"This makes firms like ours and Parametric a lot more attractive to larger banks, while FundQuest has developed its niche with smaller and midsize banks," he said.
Placemark has grown rapidly over the past four years. Its assets under management grew 50% last year, to $7 billion at yearend, and Mr. Bullard said its assets have doubled on average each of the past three years.
"We have grown from $100 million" four years ago "to $7 billion in pretty quick order," he said. "And I am pretty confident that we can maintain that kind of growth. I mean, it is hard to predict the markets, but we expect significant growth despite market conditions."
