|
BASED ON 45,000
surveys with 401(k) plan sponsors, the 401kExchange
2006 Market Share Report, also available online by
subscription, is the only independent assessment of
record keeper penetration (see complete lists below).
While the top 10 had been gaining market share since
2000 evidencing provider consolidation and a flight to
safety, 2006 marked a growing change in that trend (see
chart at end). Smaller niche providers without
staggering corporate overhead or plans for “world
domination” are gaining market share at the expense of
larger providers while mid-level providers are
stagnating which will cause them to either go or grow,
mainly through acquisitions.
The micro and small markets have traditionally
been dominated by Principal with Fidelity
dominating the mid market - that trend continues in
2006. The payroll companies flexed their muscle in the
micro market followed mostly by insurance companies as
well as BISYS. Big movers in 2006 were John
Hancock (5th to 3rd place),
Nationwide (9th to 5th) and
Hartford (10th to 7th).
Overall, the market share of the top 10 dropped to
31.07%, down 6% from 2005 and 13% from its peak of 33.5%
in 2004. One notable missing provider in the micro and
small markets is American Funds because they do
not do record keeping but is a major force working
through independent TPA’s and outsourced partners.
Movers in 2006 to 2005 in the small market include
Great West (9th to 6th)
without the benefit of recent acquisitions and
outsourcing deals which will not show up for a while and
Transamerica (12th to 8th).
The top 10 market share dropped 8% from 34.13% in 2005
to 31.51% in 2006 and 11% off its peak of 34.82% in
2003.
The mid market remained stable though some of the larger
providers lost the greatest market share. At 46%, the
mid market top 10 has the highest aggregation of any
market by far but it showed the steepest decline in 2006
down 10% from its overall high in 2005 of 50.8%.
|
MICRO MARKET (<$1 MILLION PLAN ASSETS) |
|
Rank by Assets |
Rank by Plans |
Record Keeper |
Mkt Share by Plans |
|
1 |
1 |
Principal |
8.25% |
|
2 |
2 |
ADP |
3.42% |
|
3 |
3 |
John Hancock |
3.15% |
|
8 |
4 |
Paychex |
2.77% |
|
4 |
5 |
Nationwide |
2.70% |
|
6 |
6 |
Bisys |
2.50% |
|
5 |
7 |
Hartford |
2.43% |
|
7 |
8 |
Fidelity |
2.35% |
|
9 |
9 |
ING |
2.05% |
|
10 |
10 |
Transamerica |
1.96% |
|
|
|
|
|
|
SMALL MARKET ($1-$10 MILLION PLAN ASSETS) |
|
Rank by Assets |
Rank by Plans |
Record Keeper |
Mkt Share by Plans |
|
1 |
1 |
Principal |
9.02% |
|
2 |
2 |
Fidelity |
6.05% |
|
3 |
3 |
Bisys |
3.66% |
|
4 |
4 |
ADP |
2.38% |
|
5 |
5 |
John Hancock |
2.30% |
|
7 |
6 |
Great West |
1.72% |
|
|
7 |
Hartford |
1.67% |
|
10 |
8 |
Transamerica |
1.63% |
|
9 |
9 |
ING |
1.61% |
|
|
10 |
Nationwide |
1.49% |
|
6 |
|
MassMutual |
|
|
8 |
|
Prudential |
|
|
|
|
|
|
|
MID MARKET ($10-$100 MILLION PLAN ASSETS) |
|
Rank by Assets |
Rank by Plans |
Record Keeper |
Mkt Share by Plans |
|
1 |
1 |
Fidelity |
17.21% |
|
4 |
2 |
Principal |
5.72% |
|
3 |
3 |
Prudential |
4.67% |
|
2 |
4 |
Vanguard |
4.36% |
|
7 |
5 |
MassMutual |
3.04% |
|
5 |
6 |
T Rowe Price |
2.51% |
|
8 |
7 |
Wells Fargo |
2.38% |
|
6 |
8 |
Charles Schwab |
2.20% |
|
9 |
9 |
Bisys |
2.07% |
|
|
10 |
Wachovia |
1.85% |
|
10 |
|
ING |
|
Return to Newsletter |
 |
