Banks Could Benefit from Web-Based 401(k)s

By Bielski, Lauren | ABA Banking Journal, January 2001 | Go to article overview

Banks Could Benefit from Web-Based 401(k)s


Bielski, Lauren, ABA Banking Journal


New research in the trust area shows that web-based programs are emerging as a significant disrupter to the $2.5 trillion defined contribution industry--much as online brokerage trading did before it.

In a study just released, TowerGroup, Needham, Mass., speculated that by 2005, 65% of U.S. companies with less than 500 employees will sponsor 401(k) plans, up from 35% in 2000. The advent of electronic 401(k) initiatives will account for the growth.

"The technology will bring 401(k) plans to the previously underserved micro segment of the market," says Dennis Geru, director of online brokerage and investing services at TowerGroup. Although the study didn't focus on bank involvement, Geru clearly sees opportunity there. "It's a way for banks to cement relationships with their small business customers. Clearly, companies are clamoring for it."

TowerGroup expects that the market will produce either full-service 401(k) providers; new third-party outsourcers for recordkeeping and administration; or creators of new market channels. The latter would function as a kind of virtual "supermarket" for 401(k) programs--funneling assets to money managers and matching plan sponsers to plan providers. It's that channel role that Gem belives is the sweet spot for banks.

"Today, servicing the small business [with 50 or less employees] isn't a profitable market for banks," observes Ceru. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Banks Could Benefit from Web-Based 401(k)s
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.