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The growing number of high-net-worth (HNW) clients served by branch-based bank advisors has made access to sophisticated product options and planning resources all the more important.

Advisors surveyed for the Report Card on Banks typically serve clients with between $100,000 and $1 million in assets. This year, the vast majority of advisors’ client households (78.3%) had assets in that range, similar to the 79% reported two years ago. (Bank of Nova Scotia is excluded from this data, as their advisors cannot provide individual book information.)

But the percentage of clients whose assets exceed $1 million — defined as HNW by the banks — has nearly doubled within the past five years. HNW clients accounted for 14.3% of advisors’ books in 2021, up from 8.2% in 2017. Meanwhile, clients with less than $100,000 in assets comprised only 7.5% of advisors’ books in 2021, compared with 12.3% in 2017 — a change that may be due to the rise of robo-advisors both within and outside banks.

As the share of HNW clients in books has increased, bank branches’ performance at serving wealthy clients has faltered. This year, the average rating for the “Products & support for high-net-worth clients” category was 8.3, down from 8.6 in 2019. (Year-over-year comparisons are not possible as research did not occur in 2020.)

HNW clients with complex planning needs typically move via referral from their in-branch advisor to advisors working in private wealth or brokerage divisions, who offer more specialized care and broader product offerings.

“We don’t have anything specifically for HNW [clients and] we have to refer them to another division. We’re basically giving up clients,” said a Scotiabank advisor in Ontario.

Scotiabank received an 8.3 rating for the HNW support category, down from 8.6 in 2019. But not all advisors with the bank were unhappy about referring HNW clients to another division. “We have a great referral system for people who need more and the onboarding to Scotia Wealth [Management] is seamless,” said a Scotiabank advisor in Ontario.

CIBC was rated highest in the HNW category this year at 9.6, up from 9.3 in 2019. While some advisors weren’t happy about referring HNW clients to another division — “To lose a big client hurts,” said an advisor with CIBC Imperial Service in Ontario — many others said they have strong planning support for large clients on their books.

“There’s a lot of support for clients above $1 million,” said a CIBC advisor in Alberta. “Most clients above $2 million, I try to push them toward private wealth, [but the] financial planning team from Toronto will often have webinars for our high-net-worth clients.”

Bank of Montreal (BMO) was rated 8.2 in the HNW category this year as compared with 8.5 two years ago. As one advisor noted, HNW clients generally received the same support as other clients.

“We’re expected to do a little more in-depth planning [for HNW clients] if they choose to remain at branch level, but we don’t get extra tools,” said a BMO advisor in the Prairies.

A BMO spokesperson stated in an email to Investment Executive that all clients who meet with a branch advisor are expected to receive the same service and benefits, regardless of asset size. If a HNW client needs additional services, the advisor can refer the client, since the main focus of branch-based planners should be “mass-affluent customers and their families.”

The lowest-rated bank in the HNW support category this year was Toronto-Dominion Bank (TD), which received a 6.6 rating, down from 7.4 in 2019.

“I don’t think we have the services we should for higher-net-worth people,” said a TD Wealth Financial Planning advisor in Ontario. “Accountants and tax specialists should be provided to them. It’s fine for the average clients, but the people who give us more deserve to get more.”

Whether an HNW client should be referred to another division is based on several factors, such as the complexity of the advice they require, said Dave Kelly, former senior vice-president and head of TD Wealth Private Wealth Management and TD Wealth Financial Planning. “It’s not necessarily affluence that causes the customer to…be better served by one [advisor group] or the other.”

The banks generally agreed that clients’ needs might change around the $1-million mark, but referring an HNW client to another division would ultimately depend on the client’s preferences.

“We’re going to do what our client wants,” said Peter Lee, executive vice-president, banking centres, with CIBC. “What’s important is to make sure [the client is] aware of the offers and our capabilities.”