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Biggest providers account for 72% of assets
The majority of the defined contribution plan record-keeping business is concentrated among 10 firms, according to the 2000 Pensions fy Investments Defined Contribution Service Providers survey.
The 10 largest firms run about 72% of the $2.4 trillion in assets under record keeping by the firms surveyed, the survey indicated. Those 10 - from the most to the least - are Fidelity, TIAA-CREF, CitiStreet, Hewitt, Merrill Lynch, Vanguard, MetLife Inc., Putnam, T. Rowe Price and Aetna, which recently sold its retirement business to ING
Overall, Fidelity Investments, Boston, is in the top slot this year, record keeping the most assets, $480 billion, and participants, 8.3 million. The Teachers Insurance and Annuity Association, New York, ranked second in assets, with $295 billion, and eighth in terms of number of participants, with 2.3 million. Newcomer CitiStreet, Boston, ranked third in terms of both assets, $200 billion, and number of participant accounts record kept, 4.5 million. Hewitt Associates LLC, the only record keeper in the top 10 without a line of proprietary funds, was fourth in assets record kept with $180 billion, and second in number of participants with 4.5 million.
Hewitt was one of only five record keepers surveyed that do not manage money. The other four are Alliance Benefit Group, First Mercantile, Milliman St Robertson Inc., Seattle, and PFPC, Los Angeles. All of them serve mainly corporate 401(k) plans. However, PFPC does have clients with 457 and 403(b) plans. In all, 75 service providers responded to this year's survey.
Equitable Life Assurance Society of the U.S., New York, with around 46,000 plan sponsors, topped the list of service providers ranked by number of sponsors for which they provide record keeping. Ranked second is Principal Financial with about 32,000 sponsors
This year's survey was greatly expanded to include questions directed at defined contribution record keepers and the types and size of plans they are record keeping. For the first time, the survey asked about a record keeper's experience in the newly emerging Taft-Hartley member-directed defined contribution plan market and asked providers to indicate what size plans they service. Pensions fy Investments' staff was assisted in the revamping with the help of Ron Eisen, president of Investment Management Consultants Inc.,...