Terri Shell, a representative of The Principal Financial Group, said Trustar instead will focus on its self directed brokerage business and its trust and trade desk services. Trustar is a subsidiary of Principal.
The change in corporate focus also means the loss of 75 jobs at Trustar’s Wilmington, Delaware operation – about a third of the workers assigned there, Shell said.
She said the decision to jettison Trustar’s full-service RK segment followed a corporate evaluation, which concluded, “…profitability and growth in the TPA business is limited and would not meet our profitability and growth goals.”
The move to refocus Trustar’s on the company’s self-directed brokerage business and an expansion of its trust and trade-desk services, will affect 450 retirement plans. Shell said Trustar is working with the clients to arrange a new RK provider.
The transition out of full-service TPA recordkeeping began in early August and should be completed in October, Shell said.
The announcement was one of several in recent weeks involving recordkeeping operations. Earlier this month Prudential decided in partnership with its US Consumer Group and Prudential Securities, Inc. to offer BISYS as the successor recordkeeper for its Third Party Administrator (TPA) Alliance plans.
Bucking recent trends, just last week Lincoln Financial Group announced its decision to acquire The Administrative Management Group, Inc., an employee benefits recordkeeping firm based in Arlington Heights, Illinois. However, that acquisition broadened Lincoln’s recordkeeping capabilities beyond just defined contribution accounting, according to the firm – including the burgeoning total benefits outsourcing trends.