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In early February, the launch of Altruist’s artificial intelligence tax planning tool sparked a selloff in wealth management stocks. But a new report by Fitch Ratings does not view the adoption of AI-enabled advisory tools as a near-term credit driver for the wealth management firms Fitch rates, including Charles Schwab, Raymond James, Ameriprise, Stifel and LPL Holdings.
“While technology advancement may compress demand for certain back-office wealth management functions over time, the peer group’s credit profiles are underpinned by scale advantages, diversified revenue streams, established client relationships and the enduring importance of advisor-led relationships in complex wealth planning,” Fitch wrote in its report. “Fitch expects firms to continue investing in AI and technology infrastructure while maintaining the human advisory relationships that differentiate their value propositions.”
Wealth management firms could face medium-term competition from such AI tools.
Overall, in its review of the five U.S. wealth managers, Fitch affirmed its ratings for each firm, with outlooks remaining stable.
Client assets across the firms reached record levels last year, up about 19% year-over-year, which the ratings agency attributed to market appreciation, advisor recruiting and net new asset growth. But this year will likely bring more moderate client asset growth, due to market volatility. Fitch also expects investors will be affected by geopolitical uncertainties, leading to single-digit organic growth and moderate advisor recruiting.
Pre-tax margins averaged 24% in 2025, unchanged year over year.
The firms were active in the M&A space, focusing on bolt-on acquisitions to add capabilities and scale, which Fitch viewed as credit neutral to modestly positive.
Fitch cited Raymond James’ acquisitions of Clark Capital Management, an asset manager with over $46 billion in assets, and GreensLedge Holdings, a structured credit advisory boutique. It also refers to Schwab’s acquisition of Forge Global, a private market platform, and LPL Financial’s integration of Commonwealth Financial Network.
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