Illinois bank taps a partner to help launch trust business

Core Insights - Signature Bank in Rosemont, Illinois, recognized the need for enhanced trust services to meet the growing demands of family-owned small businesses and law firms it serves [1][2] - The bank has launched a bank-branded trust unit, Signature Trust, in partnership with Midwest Trust, which has $18 billion in assets, to better serve its clients' trust needs [3][4] Company Strategy - Signature Bank faced challenges in providing trust services due to limited scale and capital, as well as concerns about compliance burdens associated with running a standalone trust company [3][5] - The partnership with Midwest Trust allows Signature to offer a range of trust services, including personal trust administration, estate settlement, and investment management accounts, without the need for extensive internal resources [6][9] Market Context - The launch of Signature Trust occurs amidst a trend where several banks, including Huntington Bancshares and Citi, are divesting their trust units to streamline operations [7][9] - Midwest Trust has benefited from this trend, acquiring institutional trust services from BMO Bank, and currently provides services to over 50 banks nationwide [8] Operational Insights - Signature Bank's wealth management unit will monitor the partnership with Midwest Trust, which will handle trust operations, allowing Signature to maintain a focus on its core competencies in commercial and retail banking [5][11] - The collaboration is seen as a strategic move to enhance client relationships and provide a more comprehensive service offering, despite the bank not having full control over trust operations [5][10]