erving as trustee for another is a noble thing. But being a competent corporate fiduciary
is simply not enough in today’s world. The dramatic drop in market-based fees means
that the average trust and investment management department is either teetering near
the break point between profit and loss or is already operating at a deficit. Caught in the
maelstrom of economic turmoil, those who run trust and financial services had better be
Every manager faces three challenges that are so basic they reside at
the bottom of the business person’s “pyramid of hierarchical needs.”
• Improve the spread between profit and loss.
• Avoid loss through errors of omission or commission.
• Ensure the aggregate of new revenue is greater than lost revenue.
Photograph ©2009 Jupiterimages
This article outlines commonsense rules that if applied will widen
the spread between profit and loss. Each rule should be considered
sacrosanct in concept, but in practice, each may need to be adapted to
fit the organization’s unique structure.
By Alan Armstrong, CTFA