By Andrew Welsch and Rebecca Ungarino

President Donald Trump's tariffs sent markets into a tailspin in April. But you wouldn't know it just by looking at how much money affluent people have invested with banks' wealth management businesses.

Consider the four largest U.S. lenders. JPMorgan Chase said client investment assets were up 14% to $1.15 trillion. Wells Fargo's client assets rose 7% to $2.34 trillion, and Citigroup, which is trying to scale up its wealth business, said client assets jumped 17% to $635 billion. Bank of America said client balances rose 10% to $4.4 trillion between its private bank and Merrill Lynch.

Lenders best known for their Wall Street operations showed similar fortunes. Morgan Stanley's wealth business hit a record $6.5 trillion in client assets, up 14%. Goldman said wealth management clients' assets rose to a record $1.7 trillion.

Those increases reflect markets' rebound from April lows, but they also mask the total impact of the volatility on investor behavior. While stocks and bonds recovered nicely, some investors didn't pour as much new money into their accounts in the quarter. For instance, Citi's wealth unit reported net new investment assets, or NNIA, of just $2 billion during the second quarter. That's down from $16.5 billion for the first quarter and $10.3 billion for the same period a year ago.

Andy Sieg, the head of wealth management at Citi, said in a memo to employees Tuesday that although bringing in new assets remains a priority, flows for the quarter "were understandably challenged by macro events." The firm still drew $48 billion of inflows in the past year, he noted.

"Importantly, clients remain eager to put their wealth to work as the macro picture starts to stabilize, and NNIA remains vital to a sustainable growth trajectory," Sieg wrote.

Bank of New York Mellon's Pershing unit, which custodies assets on behalf of wealth managers, suffered $10 billion in net asset outflows in the second quarter, even as total assets under custody rose 8% to $2.8 trillion. Executives attributed the outflows partly to losing a client that a competitor acquired.

The second quarter of the year can be a challenging period for gathering assets because clients withdraw funds to pay taxes in April, though some executives said some clients took advantage of the market drop to buy the dip.

Morgan Stanley, one of the nation's largest wealth managers, reeled in net new assets of $59.2 billion. That's up from $36.4 billion for the same period last year, though down from $93.8 billion last quarter. Tax outflows led to a $22 billion headwind, CFO Sharon Yeshaya said.

Looking ahead. Whether banks' wealth management arms can reel in more client money during the second half of this year may depend on where the president takes his trade war. Tariff uncertainty chilled investment banking activity earlier this year. Should IPOs and dealmaking activity rebound in the second half of 2025, that would create a trickle-down effect on wealth management as financial advisors would have opportunities to manage windfalls on behalf of investors.

A senior wealth management executive, who spoke on the condition of anonymity to discuss his views frankly, said, "Everyone is getting out of the prediction business because there's so much uncertainty with this regime." However, he said: "I am personally bullish."

Write to Andrew Welsch at andrew.welsch@barrons.com and Rebecca Ungarino at rebecca.ungarino@barrons.com

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July 16, 2025 14:29 ET (18:29 GMT)

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