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Truist Deals Retirement Business to OneDigital, Ascensus and Empower

Practice Management

Truist Financial Corporation announced Jan. 6 that it has sold its institutional 401(k) investment advisory services business to OneDigital Investment Advisors (OneDigital), and has signed definitive agreements to sell its institutional 401(k) recordkeeping businesses to Ascensus and Empower Retirement. 

The OneDigital transaction closed Dec. 31, 2020, while the Ascensus and Empower transactions are scheduled to close in the first quarter of 2021.

Under the OneDigital agreement, the firm will acquire approximately 1,200 plans, representing $10 billion in plan assets, expanding its presence in the retirement and wealth management space. OneDigital notes that the move comes as employers are seeking ways to better serve the financial needs of employees interested in more personalized and customized financial solutions. 

“The American family is faced with more financial and healthcare complexities than ever before and as a result, employees are looking to their employers to provide individualized advice across these areas,” says Vince Morris, President of OneDigital Retirement + Wealth. “As an industry, we’re seeing this shift in how these services are delivered using people and technology to provide customized and personalized solutions and we are leading that change to the benefit of our clients’ workforce.” 

The addition of Truist’s institutional 401(k) investment advisory business caps 37 acquisitions completed by OneDigital in 2020. The Atlanta-based firm notes that its comprehensive advisory services are now offered in more than 100 offices and an additional 45 retirement and wealth offices throughout the country, serving around 60,000 clients. 

Empower will acquire the heritage SunTrust 401(k) recordkeeping business, which includes approximately 300 retirement plans consisting of more than 73,000 plan participants and $5 billion in plan assets. Empower currently provides recordkeeping services for Truist through its private-label retirement plan unit, Empower Institutional. Because of this long-standing relationship, the transition is expected to be seamless and will not require conversions, according to the firm’s announcement.

“With this transaction, we will continue to expand our capabilities, enhance our financial wellness and advice offerings, and accelerate our value creation for all our stakeholders,” stated Edmund F. Murphy III, Empower Retirement President and CEO.  

In addition to the Empower acquisition of the heritage SunTrust 401(k) plan recordkeeping business, OneDigital will serve as the advisor to most of the plans that Empower will administer. The deal also comes as Empower announced Jan. 4 that it had completed the acquisition of the MassMutual retirement plan business. The acquisition increases Empower’s participant base to more than 12 million and retirement services recordkeeping assets to approximately $884 billion administered in approximately 67,000 workplace savings plans.

Ascensus will acquire the heritage BB&T 401(k) recordkeeping business, which includes more than 1,200 retirement plans, consisting of approximately 125,000 plan participants and $5 billion in assets. 

The Truist business acquired by Ascensus covers more than 1,200 plans with approximately 125,000 participants and $5 billion in assets, increasing the firm’s retirement plan count to more than 115,000, its participant base to more than 3.4 million, and its retirement plan assets under administration to more than $192 billion.

“We’re extremely honored that Truist chose Ascensus to serve its heritage BB&T and Ascensus-administered retirement plans going forward,” says Kevin Cox, president of Ascensus’ Retirement line of business. “We've enjoyed a great degree of success in partnership with Truist and look forward to continuing our tradition of service excellence in helping participants save for retirement.”

The terms of the three transactions were not disclosed.