Two years ago Bruce Wolfe, then newly hired to lead wealth management efforts at Webster Financial Corp. of Norwalk, Conn., said he planned to double assets under management in four or five years.
Webster is now well on the way to that goal, he said last week. Two acquisitions since he joined — acquisitions made while riding the banking company’s growth in New England and New York — and strong organic growth have both helped.
Now the $17.4 billion-asset company is scouting a wider territory for wealth management acquisitions, Mr. Wolfe said.
“The bank is moving east to west,” he said. “We continue to look for acquisitions in our footprint, but that stretches now from Yonkers, N.Y., to southern Massachusetts.
“We are looking for partners from New York City to Connecticut to Rhode Island to southern Massachusetts to the suburbs of Boston,” he said.
Assets under management rose 20% and revenue 15% in the operation’s first full year under Mr. Wolfe. Webster was managing $2.2 billion when he came aboard in October 2003; this June 30 its two wealth management units — Webster Financial Advisors, which focuses on high-net-worth individuals, and Webster Investor Services, which handles mass-market investors — were managing $3.6 billion.
“When I joined the firm we hoped to double the business in four to five years,” he said last week. “To do that we needed 20% growth each year. I think we are definitely on track.”
The company made its first wealth management acquisition just after he arrived, buying the financial planner Fleming, Perry & Cox of Norwalk. Fleming Perry enabled it to create sophisticated financial plans for its customers, Mr. Wolfe said.
In the first quarter of 2004, Webster bought Phoenix National Trust Co., a Hartford, Conn., trust firm. And this June it bought the New Haven wealth manager J. Bush & Co. from PNC Financial Services Group Inc.
The $90.7 billion-asset PNC had acquired J. Bush, which is still using that name under Webster, just a few months earlier. PNC got it when it acquired Riggs National Corp. in March.
These acquisitions alone did not drive Webster’s growth in the past two years, Mr. Wolfe said. He said Phoenix managed only $100 million of assets, and J. Bush managed $200 million. By adding new services and new customers provided by these firms, Webster has been able to increase its wallet share, he said.
“Relationships have grown dramatically with high-net-worth customers and institutional customers,” Mr. Wolfe said. “At Webster Financial Advisors, business productivity has tripled; where we were once doing $100 of business, we are now doing $300 of business.”
He added, “The big driver is that we have brought in talented people through these deals.”
J. Bush & Co.’s president and chief executive officer is Jonathan Bush, an uncle of President Bush. He said Webster is well positioned to make more acquisitions, because many small financial advisers would rather partner with a small company than a big one.
“I liked the people at PNC, but they were just too huge,” he said. “We didn’t have a role to play in that organization.”
Furthermore, Mr. Bush, now a senior vice president at Webster Financial Advisors, said, small financial planning firms like his can make a bigger splash at a small or midsize bank. “With Webster, we can be an asset,” he said.
“Smaller banks offer a lot more. You are someone when you are with Webster,” he said.
“You can’t even find yourself with PNC,” Mr. Bush said. “We really can contribute with Webster. There is not much we can do with PNC to make an impact.”
Paul Werlin, the president of Human Capital Resources Inc., a St. Petersburg, Fla., analytical firm, said planners from small operations may be happier at small banks than big ones. “It really depends on where they come,” he said.
“If a planner has worked for a large firm, they might fit in at a Wachovia or a Bank of America, where they won’t have input or access,” Mr. Werlin said. “But smaller planners who have gotten accustomed to autonomy might not be comfortable with that. These guys don’t want to be one of 5,000; they’d rather be one of 30.”
Mr. Wolfe said Webster wants to bring in more investment managers. Geographically, he said the bank would like to develop its wealth management presence in Providence, outside of Boston, and in New York state in Westchester County.
