Edward Jones Clears Final Hurdle, Set to Launch In-House Bank by 2027
Original reporting sourced from WealthManagement.com.
In a strategic move years in the making, financial services giant Edward Jones has received the conditional approvals needed to charter its own bank, marking a significant shift in how the firm will manage client assets and internal capital.
The Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions signed off on the application late last week, clearing the path for the launch of Edward Jones Bank. Slated to open its doors in 2027 with headquarters in the Salt Lake City area, the bank will be helmed by Andrea Moss, a seasoned Utah-based banking executive who joined Edward Jones last year.
This approval represents a second wind for the project. Edward Jones initially filed to start a bank in 2020 but withdrew the application two years later, citing volatile market conditions. The firm's persistence underscores a broader trend among large wealth managers seeking greater control over banking products, which can drive client loyalty and create new revenue streams.
The new entity will absorb and expand the firm's existing reserve line of credit portfolio, currently available in 47 states and Washington, D.C., to a nationwide offering. It will also accept deposits through an insured program and offer certificates of deposit, directly competing with traditional banking partners.
"This isn't about replacing our partnerships; it's about enhancing our ecosystem," said David Chubak, head of wealth management at Edward Jones. "Having a unified view of a client's banking and investment life allows our advisors to deliver more holistic, impactful guidance."
Analysts note the in-house bank will serve a dual purpose: bolstering loan capabilities for Edward Jones Ventures, its corporate venture arm, and strengthening its push into the lucrative upper-high-net-worth segment. This follows last year's launch of "Edward Jones Generations," a dedicated service for clients with over $10 million in investable assets.
Moss, formerly President and CEO of Nelnet Bank, will be tasked with integrating the bank's offerings with the firm's network of more than 20,000 financial advisors, who collectively oversee approximately $2.5 trillion in client assets.
Industry Reaction:
"This is a logical, if ambitious, vertical integration," said Michael R. Chen, a financial services consultant at Brighton Advisors. "Edward Jones is betting that controlling the banking relationship will increase 'stickiness' and cross-selling opportunities, especially for their top-tier clients. The execution risk, however, in building a compliant bank from scratch is substantial."
"Finally! This gives our practice the tools to be a true one-stop shop," commented Sarah J. Miller, an Edward Jones financial advisor based in Denver. "Being able to offer seamless banking solutions alongside investment advice is what clients have been asking for. It makes us more competitive against the mega-banks."
"A staggering misallocation of resources and a clear conflict of interest," argued David K. Feldstein, a vocal critic and professor of finance at Carter University. "This isn't for client empowerment; it's for profit extraction. They're creating a captive audience for their own loan products. The 'unfavorable conditions' in 2022? That was the market telling them it was a bad idea. They didn't listen."
"The regulatory hurdle was the big one, and they've cleared it," noted Priya Vaswani, a banking industry analyst with FinTech Watch. "The timeline to 2027 gives them a long runway to build the infrastructure. The real test will be whether their famously relationship-driven advisor force can effectively become bankers without compromising their core advisory role."