Principal Financial Group today announced marked progress in the integration of the Wells Fargo Institutional Retirement & Trust (IRT) business, which it acquired in July 2019 and is on track for completion in 2021.
Principal said it has advanced key decisions on people, processes, and technology, despite challenges posed by COVID-19 and related market disruption. The $1.2 billion combining of the organizations effectively doubled the size of Principal’s retirement business and created one of the largest U.S. retirement services providers with 7.5 million customers and 56,000 plans.
The merger is already delivering new and enhanced capabilities to Principal and Wells Fargo IRT customers including a digital plan onboarding experience, the patent-pending Principal Complete Pension Solution, the Principal Milestones financial wellness program, and more.
“Despite COVID-19, our integration team has continued to make important progress in bringing these two businesses together over the past year,” said Renee Schaaf, president, Retirement and Income Solutions at Principal. “We have stayed dedicated to the integration without losing focus on supporting current customer and financial professional needs, particularly as they’re navigating rapidly evolving market conditions impacting retirement plans, investments, and businesses as a result of the pandemic.”
In the past year, Principal has announced combined leadership teams, organizational design, service models, and technology platforms. The unified retirement leadership team includes a balance of executives from Wells Fargo IRT and Principal.
The company has also announced and affirmed its commitment to retaining locations in Charlotte, N.C.; Minneapolis/Roseville, Minn.; Waco, Texas; Winston-Salem, N.C.; and Manila, Philippines. Just last month, Principal secured an office space in downtown Minneapolis that will welcome employees in 2021.
Additionally, many Wells Fargo IRT employees have received job offers to transition employment to Principal effective in 2021. Principal, now a top-three recordkeeper as a result of the acquisition, has also appointed a new sales leadership team, innovated its advisor and consultant service model, and expanded its sales force.
“Since we announced the acquisition, we’ve been intentional about extracting the best from both businesses to deliver unmatched capabilities,” said Schaaf. “We’re helping meet the needs of all customer segments with comprehensive retirement, trust and custody, executive benefits, and discretionary asset management offerings.”
Principal announced it will start welcoming participants in October through Principal Real Start, a simplified and highly personalized onboarding experience. The process aims to be seamless for plan sponsors and participants as Principal manages all transition logistics.
The Principal Real Start onboarding platform promotes retirement savings best practices and provides access to new tools, resources, and guidance that will help plan sponsors and participants take informed actions to help improve plan outcomes. The company reports that more than one-third of current Principal Real Start participants are saving 10% or more and one-in-three are auto-escalating their contributions up to 10%.
Principal cites the example of integrated health care organization Carilion as a long-standing Wells Fargo IRT client who is realizing the value the integration with Principal can hold for their participants.
“Carilion was searching for a way to enhance the retirement savings opportunities of our 13,000+ employees,” said Heather Davenport, vice president, human resource operations. “We chose Principal because we believe their digital capabilities, leadership, and strategy can only improve upon the successful participant outcomes we’ve already experienced with Wells Fargo IRT. We look forward to seeing where this relationship takes us.”
• SEE ALSO: Done Deal: Principal Closes $1.2B Wells Fargo Retirement Acquisition
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
