- Sloan says lender has been working on service for some time
- Millennials like robo-advising, though lack money, Sloan says
Wells Fargo & Co., the world’s most valuable bank, plans to start a robo-advisory service in 2017, Chief Operating Officer Tim Sloan said.
“You’ll probably see us roll that out some time in the first half of next year,” Sloan, 56, said Wednesday during an interview at Wells Fargo’s Toronto office. “It might be a bit sooner or a bit later."
Wells Fargo has been studying an online automated investing platform to supplement the bank’s existing wealth-management offerings, Sloan said. The San Francisco-based lender’s wealth businesses include its Abbot Downing unit for ultra-rich clients, a brokerage with financial advisers, licensed bankers in branches for mass affluent customers and an online trading platform, he said.
“What we don’t have in that lineup is a robo-advising option," Sloan said. "I don’t think it’s fundamentally going to change the investment business, but for a segment of our customer base they would like that -- they want to invest on their own, and that’s terrific."
Wells Fargo earned about 10 percent of its $23 billion of annual profit last year from wealth and investment management, compared with about 59 percent from community banking and 36 percent from wholesale banking.
Robo-advisers typically use algorithms to offer investment advice online with little or no human contact, with customers providing their age, income, risk-tolerance and goals through a smartphone, tablet or computer.
“When you think about who would use robo-advising more often, you think about the millennials," Sloan said. "One of the reasons why it’s not going to fundamentally change the business is, while there are a lot of millennials, they don’t have any money. But they like convenience."