The word on the street is that Principal Financial Group Inc is in talks to acquire Wells Fargo & Co’s retirement plan services business, in a deal that could exceed $1 billion.
With Wells Fargo still trying to overcome some banking scandals, they’re trying to cash out of the 401(k) business. It continues the trend since around 2012 of further consolidation in the 401(k) plan industry.
If the deal goes through, the question is what will happen with further consolidation? Will fees go lower because of lower operating costs or will fees go higher because of less competition? Your guess is as good as mine.
