We talk to the the president of KeyBank's wealth management business about the results this area has achieved in recent months, and he reflects on how, for example, to get the mass-affluent offering right.

Regional US banks haven’t had the easiest of times in recent years, but for Cleveland-headquartered KeyBank, a bright spot for its business is private banking and wealth management. 

The firm’s build-out of its private client and portfolio offerings, tapping into the expertise across the group, has seen notable wins, Joe Skarda (pictured), president of Key Wealth at the bank, told Family Wealth Report in a recent interview. 

Joe Skarda

Key's business strategy includes providing trust and investment management, as well as institutional trust and banking services for individuals, families, business owners and institutions across the wealth spectrum. Within the Key Wealth group, Key Private Client is a mass-affluent business ($250,000 to $2 million in investible assets); Key Private Bank is the HNW segment ($2 million to $10 million); Key Family Wealth covers clients with $10 million-plus, and there is the Institutional Advisory business.

From March 2023 to June 2024, the Key Wealth business onboarded more than 31,000 clients to Key Private Client and $2.9 billion in new assets.

“In 2023 our goal was to onboard 6,000 new clients and gather 300 million in assets, which we exceeded (onboarding 19,000 and 1.6 billion in new assets),” Skarda, who joined Key in 2021, said. Before joining the firm, he was a managing director and head of the JP Morgan’s US wealth management central division.

No doubt the bank wants this side of its business to keep thriving to help the bottom line. On July 18, KeyCorp – the holding company listed on the NYSE – reported second-quarter attributable income from continuing operations of $237 million, dipping 5.2 per cent from a year earlier. 

Skarda spoke about how Key has been able to bring more sophisticated offerings to mass-affluent clients. Serving this market segment does, as this publication has noted before, present challenges that banks are trying to address. Key Private Client, which launched in March of 2023, is one example of Key Wealth’s organic growth strategy and collaboration efforts, he said, because it opens premium wealth offerings to mass affluent clients sitting in the retail segment. 

“We increased the investment sophistication in our mass affluent business to include the asset allocation modeling and product creation capabilities from our chief investment office within the private bank. Also on our private banking platform, we increased our alternative investment capabilities to include even more private equity, hedge funds, private credit and more" he said. These changes explain some of the attraction of new clients coming into the wealth management side of the firm. 

“Our platform caters to a diverse range of clients, spanning from mass affluent to ultra-high net worth individuals, as well as institutional clients. This versatility allows us to customize solutions across different wealth segments, ensuring that every client receives the attention and expertise they deserve,” Skarda said.

Advisory model
Talk of advisors is a reminder of how attracting talent into the bank is vital in building the business.

“We have had success in recruiting from other sectors,” Skarda said, referring to RIAs, wirehouses, regional banking competitors. “Central to our approach is a strategic investment in relationship managers. Retaining experienced professionals is crucial for Key's continued success in providing high-quality financial services and maintaining strong client relationships. We’ve grown our private client advisor and relationship manager headcount from 378 in 2021 to 471 currently.”

While some banks shy away from talking about advisor/client ratios, Skarda is happy to spell out a few numbers: On the mass affluent side of the business, Key aims for a ratio of 250 to 300 clients per advisor; with the private bank, it ranges from 80 to 120, and on family wealth, from 30 to 50.

“We’re focused on equipping financial professionals in specific areas of complex advice (i.e., Key Private Bank hires and trains credentialed specialists; trust and estate attorneys, CFPs and portfolio strategists),” he added.