It will be a "long time, if ever" before the direct, RIA and MFO channels overtake wirehouses and private banks (in terms of marketshare), but they are "on the heels of trust companies" and the closing of this gap is "only expected to accelerate," Cerulli said.

Nearly three-quarters of high net worth assets in the US are parked at wirehouses and banks, data from Cerulli Associates shows. However, the firm anticipates that the control of HNW assets by providers will expand by 7.3 per cent through 2019, with MFOs and RIAs among the greatest winners, at 10 per cent and 9 per cent respectively.

“As of year-end 2014, wealth managers controlled approximately $8 trillion in HNW and ultra high net worth (UHNW) client assets,” said Donnie Ethier, an associate director at Cerulli. “The longtime market leaders – the wirehouses, private banks, and trust companies – have maintained their reign with a collective marketshare of 72 per cent.”

“Wirehouse assets lessened from past years; however, this is not always due to a loss of assets. Instead, it can be due to a change in Cerulli’s methodology, including redistributing a wirehouse’s assets to an affiliated channel,” Ethier noted.

Cerulli warned in its High Net Worth and Ultra High Net Worth Markets 2015: Understanding and Addressing Family Offices report that wirehouses and banks “must stop relying on intra-channel recruiting,” or they will grow at a moderate pace only. “Moreover, heirs of their existing clients may be the biggest wildcard as they will likely boost growth within the independent and direct channels,” the Boston, MA-based research firm said.

Among other insights in the report, state-chartered trust companies and MFOs have experienced “significant growth.” Traditional RIAs are also now included in Cerulli’s HNW asset sizing, the firm said, because, “similar to several broker/dealers and investment councils, they may not qualify as MFOs but are successful among HNW families.”

There are 340 MFOs in the US, according to the report, structured as either RIAs or trust companies and representing $588 billion in HNW assets. Assets at state-chartered MFOs have grown by nearly 20 per cent over the past three years, it said.