Kehrer Group’s Annual Industry Checkup Highlights Data Management Challenges


A thread that runs through all our Annual Industry Checkups since we launched this service:  the ongoing consolidation of banks and credit unions.  In 2008 there were 8,504 banks and 7,806 credit unions.  At the end of 2002, those counts have declined to 4,715 and 4,760, about half as many.

Similarly, the number of banks offering investment services stood at 2,042 in 2008, while 953 credit unions were selling investments.  Now the number of banks with investment services practices is only 1,170, again about half the count 14 years ago.  On the other hand, the number of credit unions with financial advisors has increased slightly to 1,060.


The investment services business hasn’t shrunk in financial institutions over the last 14 years— it has essentially been flat.  There are just as many advisors, but they are working in larger institutions.


And those advisors work for fewer broker dealers, as both the bank-owned broker count and the number of third-party broker dealers has shrunk.


The broader picture encapsulates the headaches banks and credit unions have experienced managing their investment services and banking data through repeated mergers, of both institutions and their broker dealer partners, converting to new platforms at the same time that operations had to continue.  All without the benefit of additional revenue generated from growth.


But nobody thinks that consolidation has run its course.


Of all the critical components involved in a bank M&A, data migration ranks near the top, according to Kristefor Lysne, President of Terrapin Technologies. “Over the years, we have helped numerous customers through mergers. Having your data in good order and centralized—versus silos—are key factors of a successful merger,” said Lysne. As mergers continue to increase, firms should consider investing in technology as it will reduce overhead costs and headaches in the long term. “Leveraging data aggregation technology will establish a single source of truth, ensuring your historical data is well preserved and portable,” Lysne continued. “This is not only invaluable for M&A events but also other large-scale projects such as converting to a new clearing provider.”

About Terrapin Technologies

Terrapin Technologies provides data aggregation and business automation solutions to wealth management firms. Our platform automates and improves business processes across the organization, including compensation, compliance, and reporting. Since 1995, our expertise and technology solutions have helped our customers realize scalable and predictable growth. We help firms see the big picture, increase profits, and reduce risk.