Sterling National Bank has teamed up locally with Ameriprise Financial to serve the wealth management needs of business owners in the New York metro market, the Montebello, N.Y.-based bank announced this week.
The arrangement will allow the bank to expand the financial advisory services and investment options available to entrepreneurs in the area, the bank said.
Sterling National, which uses LPL as its third-party broker-dealer for retail customers nationwide, decided to give Ameriprise the opportunity to work with its commercial bankers in the New York market, explained David Bagatelle, president of NY Metro Markets and leader of Private Wealth Services at Sterling. "We bifurcated the relationship. We took what LPL was doing with our commercial teams and gave that to Ameriprise," he said.
The decision was prompted by a number of factors, including Ameriprise's team-oriented service approach, which the bank said was a better fit for Sterling's commercial bankers who also work in established teams.
As part of the relationship, Sterling banking teams will be able to work with nine local Ameriprise groups, including Louis C. Ciliberti & Associates, an Ameriprise financial advisory practice, which will serve as the primary point of contact for the bank.
Sterling National has 20 commercial banking teams that target small to mid-size businesses in the New York metro area with $5 million to $250 million in sales, Bagatelle said. The businesses tend to be privately held and family owned.
"We envision Ameriprise financial advisors working primarily with the owners and senior managers of these companies," Bagatelle said. They will help the entrepreneurs with both their personal wealth management needs as well as their business needs, offering, for example, retirement plans for their companies.
TOP ECHELON OF ADVISORS
The Sterling National commercial banking teams will choose the Ameriprise groups they work with based on their capabilities, success and location, Bagatelle said, but the one connecting thread will be quality. "We're primarily working with the top echelon of Ameriprise financial advisors," he said. He sees individual Ameriprise practices supporting one or two banking teams.
Others in the industry applauded the arrangement. "I dont think that it's too surprising that Sterling would need to partner with a full-service wealth management firm to better service their high-net-worth clients," said Sophie Schmitt, a senior analyst with research an advisory firm Aite Group.
While Sterling's use of LPL advisors to deliver investments to retail customers at the bank branches are great for mass-affluent clients, they may not have the expertise to work with clients that have more complex wealth management needs, particularly business owners, Schmitt noted.
"I think it's a good move for Sterling and their wealthy, business owner clients," Schmitt said.
According to Bagatelle, Ameriprise has entered into similar arrangements with other banks. "They look at this as an opportunity," he said.