US Bancorp launching unit catering to ultra-rich

By Joe Rauch

The unit, to be known as Ascent Private Capital Management, will focus on clients with at least $25 million in investable assets. Ascent will compete in a rapidly growing but fragmented market against other banks, brokerage firms and independent wealth managers and family offices.

"We think the time is right," said Mark Jordahl, president of wealth management at US Bancorp. "There isn't a competitor that has a dominant position in the market."

Commercial banks have long had private banking arms serving the trust and estate needs of wealthy clients, but are expanding the relatively low-margin business in a quest for a stable source of revenue uncorrelated to the broader lending climate.

US Bancorp plans to eventually run six Ascent offices across the Midwest, said Michael Cole, the unit's president. Its ultimate goal is to employ 60 advisers and support personnel.

The wealth management and securities services division run by Jordahl manages about $60 billion of client assets, and fueled $50 million of net income in the first quarter. That represents about 5 percent of US Bancorp's total quarterly earnings.

About one-third of the assets serviced by the division can be classified as coming from ultra-high net worth clients, Jordahl said.

Jordahl envisions the wealth management business growing at "low double digit" rates, and did not rule out acquisitions.

"We're open to that, but the cultural fit would be very important," he said.

(Reporting by Joe Rauch, editing by Jed Horowitz and Gerald E. McCormick)