Non-interest income from quality fee-based services to customers makes for healthier bottom lines.  Diversification of a bank's income means less volatility in the spreadsheet.

The investment arena tends to provide larger profit margins for banks than traditional banking services, according to Peter Ricchiuti, assistant dean of Tulane's A.B. Freeman School of Business.  Adding to the appeal is the aging baby boomer generation, which as it gets older deals with fewer expenses and therefore frees a larger pool of money for investing.

The increased amount of services banks offer also reduces the number of opportunities for clients to find other banks, and for other banks to steal away clients.  If the customer finds all they need in one shop, then the need to go elsewhere is greatly reduced.
 
Medium- and larger-sized banks that promote investment services have an advantage since they theoretically have more resources available to implement fee-based services.   Small community banks can compete against the larger competitors if they stress customer service.  A big bank's ability to attract customers is limited by the small bank's capability to maintain relationships.  Banking remains a people business, and people like doing business with those they know and trust.