News & Events

Want to open an account?

Find an office.

News

Hugh Bromma on Fox Business News

Back to Archived News Items

08-01-2008

DATE        7/30/2008
TIME        6:00 AM - 7:00 AM
STATION    Fox Business Network
LOCATION    National
PROGRAM    Fox Business Morning

JENNA LEE, co-anchor:

Well, recent surveys show eight out of 10 working Americans have begun to prepare for retirement in response to the current economic climate.  But navigating the world of 401(k)s or IRAs or Social Security can be a very daunting task.

In today’s edition of our “C Suite Sitdown” we are joined by Hugh Bromma.  He’s the CEO of Entrust Group, which manages retirement accounts with assets of over $3 billion.

So, very good welcome to you, Hugh.

Mr. HUGH BROMMA (Entrust Group CEO):  Thank you.

LEE:  Well, what exactly does your company do?  And how exactly have things changed, considering the economic environment we’re in?

Mr. BROMMA:  What we do is we do the record keeping and administration for self-directed retirement accounts, like individual retirement accounts and small business 401(k) plans where the individual or the owner of the business will actually do their own selection of the kinds of investments they want.

They’re typically non-traditional assets such as mortgage notes, loans of a different kind, accounts receivable, real estate.  Small start-ups, for example.  We do that for them.

LEE:  And so have the activities or the behavior of these people changed at all over the last maybe couple of years or even couple of months?

Mr. BROMMA:  Actually, what we found is very interesting is that individuals continue to put money away in their retirement accounts, and these are looking for investment opportunities that are non-traditional.

So they’re looking for the small company start-ups.  They’re looking for things that they can invest in where they can get something as a better return than they’re getting, let’s say, in the stock market or in the real estate market.  So they’re shifting their emphasis into areas where they believe that they’re going to have some kind of an income opportunity or long-term growth capability.

So our business has really increased as it has over the last several years.

LEE:  So give me a couple of examples of what that non-traditional investment might look like.

Mr. BROMMA:  A non-traditional asset might be something like an individual now in the housing market, for example--there are a number of foreclosures that are out there.  And what an individual does with their self-directed individual retirement account, for example, is to purchase a foreclosed property, or they will lend to someone who needs money to forestall a foreclosure, for example.

Also, small businesses or enterprises who need additional capital in a time of crisis, that they need something to bridge them over to hopefully weather the economic conditions.  Those people and IRAs and those 401(k)s will make those kinds of advances or loans to those individuals.

So it’s really non-traditional.

LEE:  Well, Hugh, non-traditional, when you mention as an example, it sounds a little risky.  Is always the non-traditional...

Mr. BROMMA:  Yes.

LEE:  ...a risky investment as well?

Mr. BROMMA:  It is riskier.  And those individuals who are in self-directed business are the ones who decide that they want to control the investment that they want to make.

So they mitigate the risk by really doing a lot of research.  They do a lot more due diligence on the kinds of investments they make, but they’re also willing to assume the risk that’s associated with that over a long term.

So we have a different dynamic than we do, let’s say, than just throwing money into the stock market and--or into a mutual fund that somebody says, ‘Here, try this.’

LEE:  Right.  Well, Hugh, for you, I mean, have you derived revenue?  How has business been for you guys over the last couple of months or so?

Mr. BROMMA:  For us, business continues to increase.  We continue to add clients because a lot of people are coming out of the stock market, out of those kinds of traditional assets, saying, ‘Gee, we need a new alternative.  We need something to look at.’  And they’re looking at those.

So we’re seeing growth while other industries are looking at declines because people are truly looking for alternatives for their long-term retirement needs.

LEE:  All right.  Hugh Bromma.  He is the CEO of Entrust Group.  Thank you so much for joining us on FOX BUSINESS MORNING.

Mr. BROMMA:  And thank you very much.

###