--- MAY 11, 2007 ---


Tiburon releases highlights of the Tiburon CEO Summit XII keynote opening presentation by Chip Roame (Managing Principal, Tiburon Strategic Advisors). Mr. Roame opened his presentation by welcoming the 107 senior executive clients and giving a brief overview of Tiburon's services. Mr. Roame then presented a brief summary of ten recent news stories and addressed the state of the financial services industry, supported by Tiburon research. Mr. Roame ended his presentation by introducing the five CEO Summit guest speakers, including John DesPrez (CEO, John Hancock Financial Services, Manulife Financial), Ed Haldeman (CEO, Putnam Investments, Marsh & McLennan), Steve Lockshin (CEO, Lydian Wealth Management, Lydian Trust Company), Jim Riepe (Retired Vice Chairman & Senior Advisor, T. Rowe Price Group), and Paul Stevens (President & CEO, Investment Company Institute)


Tiburon Strategic Advisors held its Tiburon CEO Summit XII last month in San Francisco, CA. Over 100 senior industry executives attended and participated. Chip Roame (Managing Principal, Tiburon Strategic Advisors), John DesPrez (CEO, John Hancock Financial Services, Manulife Financial), Ed Haldeman (CEO, Putnam Investments, Marsh & McLennan), Steve Lockshin (CEO, Lydian Wealth Management, Lydian Trust Company), Jim Riepe (Retired Vice Chairman & Senior Advisor, T. Rowe Price Group), and Paul Stevens (President & CEO, Investment Company Institute) made general session presentations. The CEO Summit also included three client-oriented general session panels, including the Ask the Consumers, Ask the Advisors, and Ask the Distributors panels. The topics presented in the general sessions were also discussed in-depth in nine break-out sessions. Tiburon's CEO Summits have become a unique forum for industry CEOs and leading strategy officers to gather and debate the future of the brokerage, investments, advice, and wealth management industries. Tiburon's research serves as the foundation of the CEO Summits and all participants share views openly. To facilitate information sharing, Tiburon provides summary releases like this one after each CEO Summit.

Opening Keynote Presentation: Chip Roame (Managing Principal, Tiburon Strategic Advisors)

Tiburon Managing Principal Chip Roame kicks off Tiburon CEO Summit XII with the firm's signature Future of Advice presentation

Tiburon CEO Summit XII kicked off with a keynote presentation by Chip Roame (Managing Principal, Tiburon Strategic Advisors). Chip welcomed the attendees, gave an overview of Tiburon, addressed the state of the financial services industry, offered the group an organized list of current industry issues to consider, and introduced the five guest speakers.

Tiburon Strategic Advisors

In updating the group of clients on Tiburon's activities, Mr. Roame noted that:

  • Tiburon has positioned itself uniquely as a market research & strategy consulting firm; the firm's services include a series of research reports, conference speeches, market seminars, and market research & strategy consulting services, with the later two accounting for more than two-thirds of Tiburon's revenues
  • The firm has served almost 300 corporate clients (107 of which were represented at the CEO Summit) and completed almost 1,000 projects since its founding in 1998
  • The firm's knowledge base includes mutual funds distribution, separately managed account programs, alternative investments, wealth management services, insurance products, banking services, the fee-only financial advisor market, the CPA firm market, the family office market, and various international markets
  • The firm has published twenty-six research reports, sends free weekly research reports to 40,000 industry executives, manages 13 free financial advisor benchmarking tools, manages innovative executive programs, and is proud to be hosting Tiburon CEO Summit XII

Tiburon CEO Summit XII Welcome

After briefly addressing Tiburon, Mr. Roame gave a brief history of the CEO Summits, offered highlights regarding the attendee group, and thanked the CEO Summit Planning Committee members and CEO Summit XII Sponsors:

  • Tiburon's CEO Summits were created after Mr. Roame noted the lack of a CEO-level conference across traditional industry lines, and yet saw the consistency of issues being addressed by these same executives
  • Tiburon's CEO Summits evolved from a just a handful of industry friends meeting in Tiburon to 100+ CEO-level Tiburon clients attending two day conferences at the Ritz Carlton Hotel
  • Mr. Roame reiterated the two themes of all CEO Summits - Challenging Conventional Wisdom and Maintaining a Consumer Orientation
  • Mr. Roame thanked the CEO Summit Planning Committee members (Tim Armour, John Cammack, Dennis Clark, Tif Joyce, Tom Lydon, Kevin Malone, Kirk Michie, and David Smith) for their support in securing guest speakers, nominating attendees, and acting as facilitators
  • Mr. Roame also thanked Tiburon CEO Summit XII's sponsors (Fiserv, Genworth Financial, Morningstar, and Pershing), represented by Skip Schweiss, Ron Cordes, Chris Boruff, and John Iachello respectfully, whose financial support allowed the CEO Summit to move to the Ritz Carlton hotel and the attendees list to grow in size from 75 to 100+
  • Finally, Mr. Roame closed this section of his presentation by sharing some statistics about the attendees - 100% are Tiburon clients, 94% are C-level executives, 53% traveled from back east, and about one-third each represent products, distribution, and advisory companies

Attendees at Tiburon's CEO Summit XII held April 18-19, 2007 in San Francisco, CA

Ten Recent News Stories

After addressing the CEO Summit itself, Mr. Roame focused his comments on the key issues that would likely be addressed by the general session guest speakers, the topics that he hoped would be addressed by the general session panel discussions, and the questions that he suggested be debated in the break-out sessions. Specifically, Mr. Roame started by suggesting that at least ten all-encompassing news stories were worth discussing:

  • Retail Rules! The substantial attractiveness of retail banking and investments over corporate banking, underwriting, and international businesses is evidenced by the fact that Bank of America's market capitalization recently surpassed that of Citigroup
  • There has been a focus on eliminating (perceived) conflicts of interest, with two full-service brokerage firms exiting the investment management business. Mr. Roame challenged the group to consider Smith Barney & Merrill Lynch's strategies versus those of Morgan Stanley, Wachovia Corporation, & UBS
  • Mutual funds still dominate. Mr. Roame called attention to the data ($10+ trillion in mutual funds versus ETFs at $433 billion & separately managed accounts at $720 billion (collectively $1.1 trillion)). Mutual funds make up 40% of financial assets and are used by both of the fast growing independent financial advisor channels, so while other topics may get the press, Mr. Roame encouraged the group to maintain perspective
  • There is a continuing polarization of the competition. Three mutual fund companies broke $1 trillion assets under management with American Funds leading the way, with only 30 mutual funds! And American Funds manages 7 of the 12 largest mutual funds in the country!
  • Mr. Roame questioned whether scandals continue; are 12b1 fees being used correctly?
  • The Merrill Lynch rule was recently upended. Does this level the playing field? Will anything actually change? Mr. Roame was not so sure
  • Dozens of firms are entering into the hedge funds business - Citigroup purchased one-year old Old Lane; Morgan Stanley has acquired multiple hedge fund firms. Mr. Roame also noted the attendees at a recent SEI conference maintained an impressive focus on revenues, which they noted are increasingly driven by their lower asset hedge funds
  • The consolidation of back-office providers continues, including the new Bank of New York Mellon Corporation and the State Street Corporation combination with Investors Bank & Trust
  • RIAs are emerging as a powerhouse, with The Charles Schwab Corporation adding $100 billion in assets in 2006 just from RIAs
  • Industry mergers & acquisitions continue with Power Corporation of Canada's acquisition of Putnam Investments, City National Bank's acquisition of Lydian Wealth Management, Merrill Lynch's acquisition of First Republic, and Bank of America's acquisition of US Trust

State of the Financial Services Industry

Mr. Roame then discussed his expectations for the state of the financial services industry over the coming years, as consumers liquefy their assets but the competitive playing field gets more heated:

  • Consumer households have almost $20 trillion of investable assets and $50 trillion of total assets, with an important distinction between the high dollar average and the much lower median amounts
  • US households control almost three-quarters of all investable assets, more than half invested via financial advisors
  • Baby boomers are the key market for the next two decades for five reasons, including their retirement & pending liquefaction
  • Three-quarters of baby boomers over the age of 55 have less than $100,000 in investable assets and the consumer households savings rate continues to hit new all time lows
  • The median value of baby boomers' inheritance is only $48,000; very few received more than $100,000
  • Beyond the liquefaction, another opportunity is presented by the risk of baby boomers living too long, with estimates that more than half of 65 year olds will reach age 85 and over one-third will reach 90; amongst 65 year old couples; there is a 50% chance that one (or both) will live another twenty-five years
  • Captive advisors and retail banks continue to dominate control of consumer investable assets (31% and 27% respectfully) but independent advisors continue to outgrow the competition (18% assets growth rate for fee-only financial advisors and 14% assets growth rate for independent reps)
  • Mutual funds are the dominant investment product ($10.8 trillion) and used heavily by both the fast growing independent rep and fee-only financial advisor markets - suggesting that mutual funds aren't going away - even if much of the reporting and media focus is on other products, including exchange traded funds, separately managed accounts, and hedge funds
  • Packaged fee-account assets have grown substantially over the past eight ears to over $1.5 trillion but wirehouses' client assets are still just 15% in packaged fee-accounts and similarly only 16% of independent rep clients assets are in packaged fee-accounts; amazingly, banks have done slightly better with 17% of client assets in fee-based trust accounts but only 4% of bank trust department assets are invested with third-party managers
  • More broadly, the investment process is being polarized with twin growth patterns in both market-linked products and alternative investments
  • Investments may matter less than wealth management services as baby boomers move from the liquefaction & retirement income challenge years into their estate planning & charitable giving distribution years; for instance, the fast growing independent rep market puts almost one-third of its clients assets in annuities, but over three-quarters of annuity sales represent transfers from existing policies
  • And overall there has been more bad news for product companies as distribution continues to take power from manufacturing

Guest Speaker Introductions

To close out his presentation, Mr. Roame introduced the five guest speakers and gave a brief overview of what he expected each speaker to address:

  • John DesPrez (CEO, John Hancock Financial Services, Manulife Financial) will explain the impact of life expectancy subtleties, will explain the three legged stool for retirement security, and will suggest some solutions to the retirement income challenge, including hybrid products
  • Ed Haldeman (CEO, Putnam Investments, Marsh & McLennan) will discuss mergers & acquisitions, explain the keys to Putnam's deal with Power Corporation of Canada, and address the importance of corporate management
  • Steve Lockshin (CEO, Lydian Wealth Management, Lydian Trust Company) will discuss the recent sale of Lydian Wealth Management to City National Bank and Lydian's success in serving high net worth clients ($7.5 billion in 12 years) through a series of innovations and superior execution
  • Jim Riepe (Retired Vice Chairman & Senior Advisor, T. Rowe Price Group) will share his views on retirement security (including the three potential retirement solutions), address the evolution of siloed companies & the next steps in open architecture, and share his views for successful investment management firms
  • Paul Stevens (President & CEO, Investment Company Institute) will share his US policy views, address the changing power in Washington & the changing regulatory agenda, and reveal some new ICI research that, like Tiburon research, supports the growing use of financial advisors

More Information
The following links will open specific pages on Tiburon's web site:

Related Links

2007 - 2009 Tiburon CEO Summits

Tiburon will continue to hold semi-annual CEO Summits in the fall of 2007 and in 2008-2009. Dates are October 9-10, 2007, April 10-11, 2008, October 14-15, 2008, April 9-10, 2009, and October 7-8, 2009.

Fall 2007 speakers will include Walt Bettinger (President, The Charles Schwab Corporation), Stephanie DiMarco (CEO, Advent Software), Mike Fraizer (CEO, Genworth Financial), George Gatch (CEO, JP Morgan Funds Management, JP Morgan Chase), Ron Peyton (CEO, Callan Associates), and others to be announced soon. Spring 2008 speakers will include John Hailer (CEO, IXIS Asset Management Advisors, Groupe Caisse D'Epargne), John Murphy (CEO, Oppenheimer Funds, Mass Mutual Financial Group), and others to be announced soon.

Starting in 2008, Tiburon will be holding its Spring CEO Summits at the Ritz Carlton Hotel in New York, NY in an effort to help the firm's predominately east coast & European clientele attend more easily.


Tiburon Strategic Advisors

Tiburon Strategic, based in Tiburon, CA, was formed in 1998 to offer market research & strategy consulting services to all types of financial institutions and investment managers:

  • The firm has served almost 300 corporate clients and completed almost 1,000 projects since its founding, and today, its knowledge base includes mutual fund distribution, separately managed account programs, alternative investments, wealth management, insurance products, banking services, the fee-only financial advisor market, the CPA firm market, the family office market, and various international markets.
  • Tiburon holds a series of CEO Summits semi-annually for its executive-level clients. The next CEO Summit is scheduled for October 9-10, 2007 at the Ritz Carlton Hotel in San Francisco, CA. 2008-2009 dates are April 10-11, 2008 (New York, NY), October 14-15, 2008 (San Francisco, CA), April 9-10, 2009 (New York, NY), and October 7-8, 2009 (San Francisco, CA). Attendance is by invitation only and attendance at each Summit is limited to 100 senior industry executives. Visit the CEO Summits section of Tiburon's web site for details on current and past CEO Summits, including attendee lists, meeting agendas, and highlights. Please contact Tiburon’s Managing Principal Chip Roame at CRoame@TiburonAdvisors.Com or (415) 789-2541 if you are a Tiburon client and have an interest in attending a future Tiburon CEO Summit.
  • Tiburon offers thirteen online business benchmarking tools that are available to all types of financial advisors in an effort to help them benchmark their business practices and build more successful businesses. The sites include www.BrokerBestPractice.Com for wirehouse & regional brokers, www.FABestPractices.Com for fee-only financial advisors, www.IndependentRepBestPractices.Com for independent reps, and www.PrivateBankerBestPractices.Com for private bankers. Almost 5,000 advisors have used these tools. By completing one of the online surveys, financial advisors can access a FREE copy of the relevant comprehensive Tiburon research report, which summarizes and analyzes the collective results.
  • Tiburon has published twenty-six ~300-400+ page research reports, which offer detailed analyses of growing business segments; each is available for $5,000; these reports can be ordered by contacting Brian Cotter at BCotter@TiburonAdvisors.Com or (415) 789-2546.
  • Tiburon’s weekly research releases, like this one, are emailed for free to interested industry executives, media representatives, conference planners, and individual financial advisors. Over 40,000 industry executives now receive these releases. Feel free to sign up to receive future research releases at Tiburon’s web site (www.TiburonAdvisors.Com) if this release was passed to you by a colleague and you would like to receive them directly in the future.
  • Tiburon recently added a president of its research, tools, & database business, and the firm plans to expand its workforce in 2007 and 2008. New research managers will develop proprietary research content for Tiburon research reports and client projects and new marketing managers will enhance the firm's web site, weekly research releases program, and the firm's relationships with media representatives, conference planners, and its clients & executive program members. The firm is also seeking to add principal candidates and possibly a chief consulting officer in 2007 or 2008.
  • Tiburon has built three executive programs (CEOs-in-Residence, Financial Advisor Roundtable, and Consulting Fellows) in an effort to bring the experiences of additional senior level industry executives to Tiburon clients. Feel free to contact any of the members of Tiburon’s executive programs directly or ask that they be included in any ongoing Tiburon project.