For two ambitious West Coast banks with dreams of managing their wealthiest customers' money, it's time to take on the Big Apple.

Abbot Downing, a subsidiary of Wells Fargo (WFC), and Bank of the West, the U.S. division of French lender BNP Paribas, are looking to expand their asset-management businesses by entering the lucrative New York market this year. Both banks are opening new offices in Manhattan to attract more business from people with millions of dollars of potential investments.

These San Francisco banks will face some stiff competition. Many banks, starved for robust revenue growth in their deposits-and-lending operations, are trying to expand their asset-management businesses — and their share of the regular fees that providing such financial services yields.

With more billionaires than any other city in the world, New York is home turf to many wealth management firms that specialize in serving the ultra-rich, including investment giants Goldman Sachs (GS), Morgan Stanley (MS) and Bank of America's (BAC) Merrill Lynch. The city is also the headquarters to some of the nation's biggest banks, including JPMorgan Chase (JPM) and Citigroup (NYSE:C), which are increasingly competing to manage more of their most affluent customers' investments.

"The New York metro market is clearly one of the most dynamic wealth markets in the country," says Paul Cummings, the New York regional managing director at Abbot Downing. "More than just the people that live here, it really is a gateway market for wealthy clients across a broad geography."

The New York City metropolitan area had the largest population of high net worth individuals in the U.S. in 2011, according to the latest data available from consulting and technology firm Capgemini. Roughly 4% of the area's population — 727,100 people — had at least $1 million to invest, according to Capgemini's U.S. Metro Wealth Index.

Wells Fargo already has some established wealth-management operations in the city, but now it is setting its sights higher. Abbot Downing, which caters to clients with at least $50 million to invest, provides financial services to Wells Fargo's most affluent customers. The bank created the unit in 2012 by merging two wealth management businesses, Wells Fargo Family Wealth and Lowry Hill, and now has 17 offices nationwide.

Its first New York office opened this month on Madison Avenue with a team of six wealth managers. They have a basic strategy for gaining traction in the tri-state area: Go after customers whose money goes way back.

"The clients that we work best with have significant wealth across multiple generations," says Cummings. "We help clients manage the impact of their wealth."

Abbot Downing bankers help families coordinate their philanthropic efforts and set up a system for managing their financial affairs. They also provide estate planning and tax planning strategies. As an added draw for blue bloods — and in keeping with Wells Fargo's institutional obsession with the carefully curated past — Abbot Downing has two historians on hand to chart its customers' family ancestry. After tracking down immigration records, ship manifests and the like, the historians offer families a private presentation, complete with an array of photographs and artifacts.

Pursuing a specific demographic is a smart way for West Coast lenders to gain a foothold in New York, according to Wayne Cutler, a managing director at the financial services consulting firm Novantas.

New York wealth management is "made up of many micro markets," Cutler says. He recommends that banks tap into these small groups by using a targeted approach that he compares to fly-fishing.

"In Manhattan, you don't just go after Manhattan — you go after the Upper East Side," he says. "Otherwise, you're competing in such a crowded market already."

Abbot Downing's New York efforts are also likely to be buoyed by Wells Fargo's well-known presence in the city, according to Cummings. The bank expanded significantly in New York and elsewhere on the East Coast after acquiring the Charlotte, N.C.-based Wachovia in 2008.

"It makes sense for us to come after [Wells] has already grown and established roots," Cummings says, "and it complements the investment that's been made in other businesses."

Like Abbot Downing, Bank of the West plans to direct its attentions to a niche group when it opens a New York wealth management office by the end of this year. Its staff will focus on attracting international clients familiar with its French parent company — which operates in 78 countries in Europe, Asia, Africa, and North and South America — and its multinational asset management subsidiary, BNP Paribas Investment Partners.

"We're trying to leverage the globality of the group, which is a real strength," says John Bahnken, head of Bank of the West's wealth management division. "We believe that New York, as an international city, will give us opportunities."

The wealth management group "often has introductions and referrals from Europe and Asia," Bahnken says, noting that it typically recruits clients from existing Bank of the West and BNP Paribas customers who meet qualifying criteria. (The group primarily serves the affluent — defined as people with between $1 and $3 million in investable assets — and high-net-worth customers, defined as those with between $3 million and $25 million to invest. A plan to start pursuing individuals with even more wealth is also in the works.)

"A lot of those individuals have homes and businesses in New York and the East Coast, so this is an opportunity to get inbound referrals," Bahnken says.

In keeping with Bank of the West's multinational focus, the team of 10 to 12 people starting at its New York wealth management office will include bankers who speak several languages, which may include French, Japanese, Mandarin, Cantonese, Spanish, Italian, Portuguese, Arabic and Dutch.

Despite the challenges inherent in gaining a piece of the New York wealth-management pie, opening outposts in the city makes sense for both lenders, according to Cutler of Novantas.

"You've got to follow the money," he says. "Fundamentally, out West, there are certain limitations on the number of high-net-worth and ultra-high-net-worth individuals. Even with Silicon Valley and some financial folks [on the West Coast], the population is not as dense as it is on the East Coast."

But Bank of the West and Wells Fargo may have to wait a while to see their New York wealth management operations boost the bottom line, says Chris Mutascio, an analyst at KBW.

"If you're starting from scratch or small market share, it takes time to grow and make major impact," Mutascio says. "That doesn't mean it's not worth doing and trying to gain share — Wells over time will do so. But don't look at this as a major implication for earnings growth going forward."

Sarah Todd is a news reporter at American Banker.

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