San Antonio-based USAA announced that it’s selling its investment management business to Ohio-based Victory Capital Holdings Inc. for at least $850 million.
Charles Schwab became next in line for part of the San Antonio-headquarted company. Specifically, Schwab, based in San Francisco, agreed to buy USAA Investment Management Co. for $1.8 billion. It is uncertain how this transaction will impact Victory Capital’s efforts.
The deal will bring Schwab roughly $100 billion of assets from USAA. Schwab has more than $3.5 trillion in client assets. Schwab has been moving further into wealth-management for clients formerly represented by elite Wall Street firms, according to the Journal report.
USAA’s investment-management business that Victory acquired had $81.3 billion in assets under management. Victory said it hired about 230 of the USAA unit’s 300 employees.
When USAA announced in November that it was selling the asset-management business to Victory, USAA CEO Stuart Parker said it was the largest transaction USAA has done in the past two decades, possibly ever.
A deal with Schwab could be twice the size of the Victory transaction, which has the potential to increase in value by $150 million, depending on revenue figures.
At Schwab, new retail clients opening managed investment accounts have increased 63 percent at since 2015. New account holders receiving advice now average about $600,000 in assets, according to the Journal article.
Patrick Danner is a San Antonio-based staff writer covering banking and civil courts. Read him on our free site, mySA.com, and on our subscriber site, ExpressNews.com. | firstname.lastname@example.org | Twitter: @AlamoPD