Outsourced Chief Investment Officer Service Market Has Grown Exponentially

As markets have grown more volatile and regulatory requirements more complex, there has become a need for some organizations to outsource their chief investment officer needs. In fact, the outsourced chief investment officer (OCIO) business has grown exponentially. According to data compiled by Cerulli Associates, U.S. assets managed by OCIO providers reached $3.3 trillion by year-end 2024 and, according to Cerulli’s latest projections, will reach $5.6 trillion by year-end 2029, reflecting a five-year average annual growth rate of 10.6%.

Jim Link, head of OCIO for U.S. Bancorp Asset Management, Inc. (USBAM), recently discussed the changes he’s seen in the industry, how they’ve affected the OCIO landscape, and what he anticipates it could look like over the next three years.

Jim, it’s been four years since your OCIO group joined U.S. Bancorp Asset Management as part of the PFM Asset Management acquisition. How has your team changed in that time?

Link: We went from smaller team at a boutique firm to a much larger team, one with a broad diversity of expertise and access to all the offerings of our affiliates within the sixth-largest commercial bank in the U.S.

At the time of the acquisition in 2021, PFMAM had $20 billion in assets under management. As of June 30, 2026, we have $33.1 billion in OCIO assets and are and ranked as a top 25 U.S. OCIO provider by Pensions & Investments.^1[i] We’re investing in technology enhancements to better serve current and future clients. In 2023 and 2024, we expanded our personnel and investment resources by integrating the U.S. Bank legacy Institutional Asset Management team and adding personnel from Highmark Capital Management via the MUFG Union Bank acquisition.

In early 2026, we finalized a five-year strategic plan for the OCIO business that includes variety of resource and capability expansions to materially grow our assets. As part of that plan, we recently hired Kevin Chriske to lead our efforts in the Healthcare sector. Previously, we had recruited a number of senior leaders, including Michael Kelly and Chris Reynolds, to bring their experience in endowments and foundations to the firm. Their efforts are beginning to pay dividends with almost $1 billion in assets slated to onboard in the second half of 2026. We’ve increased the size of our investment specialist team and have added client portfolio manager roles. Finally, recruiting for the important new position of CIO for our OCIO business is active and will provide the business with the focused investment leadership it needs.

How has the industry changed over the last few years?

Link: For years, we talked about the specter of consolidation, and we’ve finally seen it start to occur, with several smaller boutique OCIO firms merging with larger financial institutions. We are also seeing some firms making tough decisions on where they want to focus their business and where they’re going to deploy their limited resources to maximize growth. In many cases, that means making the decision to focus either on Wealth or Institutional markets to provide the scale in technology and people resources, and the overall allocation of limited capital resources that are necessary to compete at the highest levels.

You moved from a more boutique OCIO firm to U.S. Bancorp Asset Management. Are there advantages that come from being part a larger organization, such as a bank-owned provider?

Link: I think our clients can benefit in many ways. Large OCIO providers, such as those owned by a bank, can offer a wide breadth of products and services. If a client has a financial need, there is a product or service within the bank’s organization to meet that need. It’s great to have interconnectivity with rest of organization and it’s inspiring that all 70,000 team members are working toward the same thing – the success of our clients. Another key advantage is our risk management infrastructure. Fraud and cyberattacks are the biggest risk at any financial services firm and as a larger organization, our organization invests in the optimal security talent and technology for our clients.

What current trends are you seeing in the OCIO space?

Link: Institutions are becoming more diverse in terms of the type and size. They also have a better understanding of what an OCIO does and how it can benefit their organization. OCIO providers are seeing pricing pressures, which is a hallmark of a maturing market.

USBAM has long been a believer in maintaining composite performance and creating standards within the industry. There’s now a lot more structure around OCIOs. For example, the CFA Institute has created Global Investment Performance Standards (GIPS) standards, meant to create a foundation for calculating and presenting investment performance based on the principles of fair representation and full disclosure. This is great for investors as it gives them something closer to an apples-to-apples way to compare OCIO services. It is far from perfect, but does provide a solid framework for future enhancement. In addition, the Alpha Nasdaq OCIO Peer Group reporting has provided another way for clients and OCIOs to view performance and portfolio attributes across a number of different client types, portfolio types, and asset allocation groupings. These two different methods of comparing OCIO performance are important steps in the maturation of the marketplace.  

Foundations, endowments, and not-for-profit organizations are now living with the impact of policy changes on taxation and funding. In some cases, that means reduction or elimination of financial support from Washington, D.C. or significant tax changes for foundations, endowments and nonprofits. The changes have impacted how these organizations think about fund raising and operations along with investing and liquidity. From our perspective, there are some big higher-education endowments selling private assets, which may be a precursor to an overall decrease in illiquid assets in favor of more liquid assets.

What do the next few years look like for your team?

Link: As demand for OCIO continues to grow, we’ll continue to scale our business and broaden our service offerings to allow us to serve increasingly complex institutional investors. We’re making technology investments that will enhance our service model, including improved reporting and a client portal. We’re also hiring more specialized talent to drive sales and provide specialized services in segments where we see the biggest opportunity for growth – healthcare, endowments, foundations, and nonprofits, for example.

Click here to learn more about the U.S. Bancorp Asset Management OCIO business.

^1[i] P&I 2026 OCIO Survey. Ranking reflects USBAM by total U.S. institutional outsourced assets under management as of March 31, 2026, among managers of U.S. institutional tax-exempt assets. P&I is not affiliated with the firm. No compensation was paid in connection with obtaining or using the ranking.