BNY Pershing has begun charging some registered investment advisory clients a custody fee, reflecting a broader industry shift as custodians seek new revenue streams amid declining transaction fees and compressed margins. Former Pershing Advisor Solutions CEO Mark Tibergien noted that the firm’s revenue per asset fell to roughly eight to 12 basis points by 2020 from 25 to 30 basis points in 2007, while transaction fee margins have dropped to virtually zero. Ben Harrison, global head of client coverage at BNY Pershing, confirmed the fee changes were introduced last year to better reflect a fair value exchange, though the firm does not disclose specific pricing schedules or current revenue-per-asset figures. BNY’s Wealth Solutions unit, formed in January by combining Pershing with BNY Archer, reported $3.3 trillion in assets under custody or administration and 8.6 million average active clearing accounts at the end of the first quarter. Industry consultants and executives note that custodians like Schwab and Fidelity face similar profitability pressures, with some predicting Schwab may eventually follow Pershing’s lead in imposing RIA custody fees.
Charles Schwab CorpArticle notes Schwab faces similar profitability pressures and may eventually follow Pershing's lead in imposing RIA custody fees, which could hurt Schwab's competitive position or margins.
Fidelity National Information Services Inc