For DC plan executives, the consolidation trend can offer good news or bad news, she said. Reduced competition among record keepers could make it tougher for plans to negotiate better prices and services, she said. Other drawbacks could be reduced flexibility for investment options and services as record keepers standardize their offerings, or concerns by participants that a change in record keepers represents a takeaway of services and options.
On the positive side for sponsors, she said consolidation could lead to improvements such as enhanced web-based displays for participants to monitor their savings performance and goals and better service from a larger record keeper making a commitment to staying in the business.
Empower Retirement is still integrating elements of the three record-keeping units now under one roof and brand name, said Edmund Murphy III, Empower president of retirement services.
The former Great-West and Putnam record-keeping units used the same platform, but J.P. Morgan's was different. Integrating the J.P. Morgan system into the fold starts in April and will continue through 2016. The integration is being done this way due to different sponsor asset sizes, different sponsor plan complexities and other sponsor-related issues that make difficult an all-at-once integration, he said.
Empower Retirement also will integrate the respective record-keeping units' interfaces — what web-based services participants see and use on their computers and mobile devices — by the first quarter of 2016.
Mr. Murphy predicted growth in 2015 thanks to some new contracts that have been announced or are pending. One new contract is the Washington State Department of Retirement Systems, Olympia, for its deferred compensation program and for three other defined contribution plans whose investments are overseen by the $103.6 billion Washington State Investment Board, Olympia.
The Washington hire was announced in January and contracts take effect in October. Empower Retirement has been the record keeper for the $3.5 billion deferred compensation plan; it will replace ICMA-RC as record keeper for the other DC plans with aggregate assets of $10.7 billion.
In November, Intuit Inc., Mountain View, Calif., announced that Empower Retirement would become record keeper for its $1.2 billion, replacing Fidelity Investments.
Despite Empower's stronger presence, Fidelity Investments, Boston, remained the asset leader by a wide margin. Fidelity's $1.41 trillion in record-keeping assets represented an 11% gain from the previous survey period.
Fidelity's performance was aided by growth in the largest-sponsor markets as well as among startups, said Steve Patterson, executive vice president for sales, workplace investing. Mr. Patterson said Fidelity added $42 billion in new record-keeping business during 2014, while retaining more than 99% of existing record-keeping assets.
Although Mr. Patterson didn't provide a forecast for 2015, his company picked up a major client in American Airlines Inc., Fort Worth, Texas. The five-year agreement, to take effect in mid-2015, was announced in October.
Fidelity was the record keeper for US Airways Inc., which merged with American. J.P. Morgan Retirement Plan Services (now Empower Retirement) has been American's record keeper. When Fidelity assumes responsibility for the combined plans, it will administer aggregate assets of about $14 billion and serve approximately 120,000 participants.
Fidelity didn't acquire any record keepers. Neither did TIAA-CREF, New York, which again placed second in assets with $422.4 billion, up 8.9% from $388 billion.
TIAA-CREF benefitted from the continuing consolidation of record keepers for 403(b) plans among colleges and universities, said Edward Moslander, senior managing director and head of TIAA-CREF's institutional client service organization.
Prompted by changes in Internal Revenue Service requiring more fiduciary responsibility for 403(b) plans, a university that once might have had five record keepers now has one or two, he said.
The pace of consolidations “ebbs and flows,” Mr. Moslander said. “There's a medium pace right now. Next year, it's my gut feeling there will be more consolidations.”
Other growth sources for TIAA-CREF include 457(b) deferred compensation plans and the defined contribution components of hybrid plans in the public sector, he said.