GRAND RAPIDS — At a time when many accounting firms are spinning off divisions that do other than traditional accounting work, Plante & Moran is adding one.
Announced at the end of February, the Ohio-based certified public accounting and management consulting firm has formed a trust company: Plante Moran Trust.
The wholly owned subsidiary of Plante & Moran is led by Gary Johnson, president and CEO, who said that the new venture was started because of client demand.
“Many clients that had come to trust the partner at Plante & Moran with their tax prep and also estate planning, financial planning and in many ways, full-client financial advisor, they didn’t want to introduce a new party when it came time to executing part of the plan,” Johnson said.
“And part of the execution in many people’s estate plan is a trust, a trust for the surviving family members, so they were asking the partner to serve as trustee.”
He indicated that thoughts about the change began four or five years ago when the need first become apparent, but it took awhile to determine whether it was a good idea to enter the trust business, one that today is dominated by banks and, increasingly, by brokerage companies and mutual funds.
When the talks began, Plante & Moran wasn’t sure it had enough business to warrant a complete trust department.
However, as the years passed, the partners realized not only was there enough business, there was a growing demand for trust services.
“Over the years we had been appointed in hundreds of clients’ trusts. And we said, ‘Well — wait a minute — we need to organize ourselves.’ Establishing a trust department was really a natural response to what our clients were looking for,” said Johnson. “Our partners had experience and exposure to parts of trust but not an extensive background, so it was necessary to also hire additional staff, including myself.”
Johnson has 20 years experience in personal trust and worked in the trust department of NBD Bank in Grand Rapids from 1984-1996.
In ’96 he moved to Detroit to manage the trust and private banking business for NBD (Bank One), where he had successive increases in responsibility until the end of 2000.
When Johnson left the company at the end of 2000, he was managing private client services for Michigan and Florida. In June of 2001, Johnson began the task of launching Plant Moran Trust.
Through his and his staff’s knowledge and experience, Johnson hopes to make Plante Moran Trust stand out from the competition with its personal touch.
“You can have a trust with almost any financial services provider but it lacks the personal touch and relationship that we think is important,” he said. “We want to provide some continuity for that client, someone who understands them and knows their family and is willing to carry out their plans when the time comes, someone who has been with them every step of the way.”
“I think we can distinguish ourselves on two different levels: One is the relationship aspect and having continuity in the relationship and understanding the family circumstances, and that being with them throughout the entire process means a great deal in our ability to serve that client in the manner that they have grown to expect,” said Johnson.
The second, he said, is the way the trust company goes about managing investments that are held in the trust.
He said that by separating itself from a specific financial institution, Plante Moran Trust doesn’t have any proprietary products to peddle. In effect, the strategy is to have a process whereby it can select from the universe of either investment managers or funds that are available to accomplish what the client wants to accomplish.
“This way our interests are aligned directly with the client’s,” he said, “making it possible to really advise and make sure that either the best people are managing (individual security managers) or the funds are utilized correctly in the investment portfolio. This way you have everything in a grab form, not just what the bank has to offer.”
Johnson views Plante Moran Trust as a shortcut to the continuum.
“There is kind of a step there where we can do the estate planning, the financial planning, business succession planning, all kinds of things that a business owner or an executive require at the time of planning their investment.”
In addition, Plante Moran Trust has a registered investment advisor, an advisory firm that has been working for over 15 years and has managed nearly $2 billion in investments, which will allow the trust company to help clients through their lifetimes with investment management and their financial assets, and when it is time to execute their estate plan the trust department can serve as personal representation and the ongoing trust representative throughout the time of the trust.
“That is a resource that we have as a result of the Plante & Moran financial advisory, that really brings that capability to use and that is unique,” Johnson added.
“There are a lot of people interested in this new venture and not only our clients, who we are just beginning to make aware of the service,” said Johnson.
“But particularly attorneys who are in the business of estate planning and drafting those documents. I think we really offer something to that group of people.”