By Newman, Joseph, Jr.
American Banker , Vol. 151
Rittereiser: Bank Competition Won't Hurt Securities Industry
PHILADELPHIA -- Robert P. Rittereiser, president of the E.F. Hutton Group, a New York-based securities firm, cautioned Monday that banks "are going to be effective competitors" in offering basic financial services but not in winning the sophisticated investor.
Banks will have "a fair share of success" in dealing with the mass market, Mr. Rittereiser told a session of the Securities Industry Institute here. But he added that he would be "very concerned" as well as "very surprised" if banks will be able to compete with securities firms for affluent customers who are more risk oriented and sophisticated.
"Banks are going to have a long, long row to hoe before they are really effective [in the upscale market]," he said.
the Securities Industry Institute is sponsored annually by the Securities Industry Association and the Wharton School of the University of Pennsylvania. The E.F. Hutton executive said that banks "are doing a good job getting our customers ready for us later down the road."
In the end, the securities industry "will be the primary provider" of the upscale of financial services, he said.
Mr. Rittereiser cautioned, however, that securities firms will "have to work a heck of a lot harder to build up trust" -- a reference to the observation by panelist Glenn colacurci, senior vice president of Shearson Lehman Brothers Inc., that while bankers often the perceived as "friendly," brokers often are thought of as "salesmen. …