PNC sees the addition of a new lending solution for wealth management clients with fewer assets acting as a bridge to the firm’s broader banking offerings, a wealth executive said.

PNC’s wealth management division rolled out a securities-based lending product July 21, offering clients with more than $200,000 in assets easy access to liquidity without disrupting their investments. 

Customers looking to make a down payment for home, pay for their kids’ college or consolidate debt can use their investment accounts as collateral, with the minimum line of credit being $100,000, the $616 billion-asset bank said. 

“Clients have approached us and said, ‘Hey, we're really glad we have a financial plan with you, and … our investment management is tailored to our goals that are out there, but occasionally, we have a need for liquidity, we need to access our funds, but we don't want to take ourselves off our broader financial plan,” said Rob Santillo, head of product and research at PNC Wealth Management.

To be sure, there’s no shortage of banks chasing wealth business and growth with mass-affluent clients. Wealth effects in the economy have been a key support to growth, Pittsburgh-based PNC said in its annual filing in February. 

The lender is pursuing a national bank identity, and this type of solution is something national banks have put more focus on in the last few years, Santillo said in an interview. 

“We thought it was important to make sure that we’re strengthening our offering to make sure we’re competing with national firms,” he said.

PNC also sees the product setting it apart from smaller, independent wealth management firms that don’t have lending capabilities, or digital competitors that might be more centered on transactions, Santillo said. 

“One of our advantages is offering affluent clients both banking and investing guidance,” he said. Customers wanted the “ability to marry those two: keep their long-term investment strategy and then also access liquidity through a line of credit.”

PNC aims to offer banking and investing services to its wealth management clients, and the lending solution can “act as a bridge” between the bank and the wealth arm, Santillo said.

It’s PNC’s latest offering geared toward mass-affluent and emerging-affluent clients, following the February launch of the wealth unit’s premier client designation, and the bank’s rewards platform in April. PNC’s private bank already has a similar securities-based line of credit product; the new lending option makes it accessible to those with fewer assets.

Financial relationships tend to be fragmented, especially as accounts have become easier to open. As the bank – like its rivals – seeks primacy with its customers and greater scale, “it’s really an important solution if we’re going to be one of the primary relationships,” Santillo said.

The bank’s wealth division is particularly focused on the pending wealth transfer, Santillo said, as baby boomers pass trillions of dollars to younger generations over the next two decades.

To that end, the bank has made “significant” investments in its online wealth management capabilities over the past year, although Santillo declined to specify how much. Improvements include making it easier for clients to open accounts, move money and manage portfolios with better self-service tools, fractional share trading and simpler funding, he said.

PNC’s wealth unit is also working to expand account access and managed-account options, and roll out features such as real-time pricing and alerts, he said.

Younger customers tend to take a more self-directed approach with stocks and exchange-traded funds, but the bank is trying to bring some minimums lower, so customers can access professionally managed portfolios at a smaller scale, Santillo said. The current minimum is $5,000 and the bank is considering ways to drop it further.

“We think, when that’s done, these younger generations will see the value of professional management versus self-directed,” he said. “Especially as they garner more assets through some of this wealth transfer, that will probably transition some of the solutions that they use as well.”