Defined contribution record-keeping assets reached $4 trillion in 2011, posting a 1.9% gain from the $3.93 trillion recorded during 2010, according to the latest Pensions & Investments survey.
The number of participants rose to 82.65 million from 81.18 million, a gain of 1.8%. The number of sponsors rose to 618,479 from 616,580. Each survey contained results from 54 record keepers.
Last year's results were marked by musical chairs in the asset rankings of some of the largest companies. Aon Hewitt, Lincolnshire, Ill., climbed to third place from fourth, switching places with ING U.S. Retirement Services, Windsor, Conn.
Principal Financial Group Inc., Des Moines, Iowa, rose one notch to 11th place, trading spots with Prudential Financial Inc., Newark, N.J.
Fidelity Investments, Boston, continued to dominate the industry — in terms of assets under record keeping — with $949.1 billion last year, up 1% from its year-earlier figure.
Fidelity also topped the rankings in terms of the number of participants for which it is a record keeper with 15.23 million, a rise of 1.8%.
Stephen Patterson, Fidelity's executive vice president of sales for personal and workplace investing, attributed the firm's asset growth to new customers, increased cash flow from existing participants and market gains.
Mr. Patterson predicted Fidelity's DC record-keeping business should be able to capitalize on “integrating multiple benefits” for sponsors in other areas, including defined benefit plans, non-qualified plans, stock option plans and health plans. “Sponsors are looking at putting those with a fewer number of providers,” he said. “Health administration is taking on a bigger role.”
Mr. Patterson said Fidelity's fee-disclosure practices and its size should help it gain customers thanks to new federal regulations affecting fee disclosure between providers and sponsors that take effect in July.
“There will be significant pressure on record keepers,” Mr. Patterson said. “You need scale to operate in this environment. We expect a shakeout as the industry consolidates.”