South Dakota Trust Company (SDTC) stands at the forefront of the trust industry, combining decades of experience with a stable, dedicated team to serve clients across the globe. The company’s pioneering role in establishing South Dakota as a premier trust jurisdiction, coupled with its recent strategic partnership with JTC Group, positions SDTC uniquely to serve financial advisors and their clients seeking sophisticated trust solutions.
In an interview with The Wealth Advisor’s Scott Martin, Pierce McDowell, president of SDTC, discussed the firm’s foundational role in developing South Dakota’s trust industry, its commitment to maintaining long-term client relationships through dedicated teams, and how its recent acquisition by JTC Group enhances its capabilities while maintaining its core values.
Building a Trust Haven in South Dakota
South Dakota’s emergence as a leading trust jurisdiction stems from its progressive laws that cater to wealth preservation and family legacy planning. The state allows for perpetual trusts, strong asset protection statutes, and no state income or capital gains taxes on trusts—factors that make it an attractive jurisdiction for families seeking long-term financial security.
The state’s commitment to maintaining its competitive edge in trust services remains strong through an ongoing trust task force established in 1987. As a result, South Dakota has drawn significant trust business, serving families from all 50 states and more than 60 countries. Furthermore, as McDowell notes, the state’s small population works to the trust industry’s advantage, as it allows direct political engagement, fostering responsive and innovative trust laws that keep the state at the forefront of trust planning.
“While it is sparsely populated, you have the opportunity to go to the citizen legislature, and they listen to your concerns,” McDowell says.
As one of the pioneers in South Dakota’s trust industry, SDTC has played an integral role in shaping the state’s trust-friendly environment, helping advisors provide their clients with sophisticated trust solutions that combine the state’s favorable laws with the firm’s deep expertise in trust administration.
Building on Experience
The core of SDTC’s competitive advantage lies in its deep historical roots and experienced team. The company’s story began over two decades ago when Al King, then at Citibank’s trust department in New York, hired McDowell after reading his article in Trusts & Estates magazine about perpetual dynasty trusts, a concept that would help establish South Dakota as a premier trust jurisdiction. From those early days, SDTC has focused on recruiting and retaining top talent to serve advisors and their high-net-worth clients.
The firm emphasizes knowledge transfer, with experienced staff training new employees. Its global perspective allows SDTC to spot possibilities that even sophisticated advisors might miss. Importantly, when it identifies potential opportunities, the firm collaborates directly with advisors rather than bypassing them to speak with clients. Beyond the state’s favorable trust laws and tax environment, McDowell points to a more fundamental, human advantage that makes SDTC a premier partner.
“We’ve got the trust and tax law, the fact that it’s a no-tax environment out here, but the differential is our people,” he says. “They’ve had the experience.”
Experience and Stability as Differentiators
With more than $150 billion in assets under administration, SDTC distinguishes itself through its experienced staff and remarkably low turnover rate. The company’s approach to personnel management translates directly to client satisfaction. As McDowell emphasizes, “Treating them right, they’ll treat their clientele right.”
The firm’s team-based approach ensures continuity of service across generations, a critical feature for advisors implementing long-term wealth preservation strategies. “We build teams so that younger people are on those same accounts because, naturally, the patriarchs and matriarchs are going to pass on,” McDowell says. “And in that instance, our trust officer is going to retire, and the next one steps in, and the family is very familiar with that person. That team approach has been well received by our clientele.”
The stability and continuity of SDTC’s team structure provides essential reassurance to advisors and their clients, particularly for multigenerational planning where long-term relationships are paramount to success.
Global Reach with Personal Touch
SDTC’s client base includes numerous household names who rely on top advisors, demonstrating the firm’s ability to serve sophisticated clients while maintaining personal relationships. The company’s approach to client service combines expertise with empathy, particularly in challenging situations. “There are times when you have to say no, and it’s for the betterment of the family line,” McDowell says. “Maybe there’s a child that needs to hear the word no on a distribution and needs to prove themselves.”
The firm’s confidence in making tough decisions stems from its experienced team. “The bottom line is that we’re comfortable in our position,” he adds. “We’ve got these really good people who are going to be able to raise these issues and get the job done.”
SDTC’s expertise extends beyond traditional trust administration, offering valuable insights to financial advisors about family dynamics and beneficiary relationships that might not be apparent in standard advisor-client interactions. The ability to spot and address sensitive family dynamics early helps advisors maintain stronger, more proactive relationships with their clients while preventing potential conflicts from escalating.
Strategic Growth Through JTC Partnership
SDTC’s recent acquisition by JTC Group marks a strategic evolution that enhances its jurisdictional reach while maintaining its core values and personnel. The partnership particularly strengthens SDTC’s presence in Delaware and opens opportunities in additional jurisdictions, allowing advisors to select optimal trust locations for their clients’ needs.
The integration preserves continuity in leadership, with key SDTC executives appointed to run JTC’s North American operations. McDowell emphasizes the cultural alignment between the organizations: “They presented themselves as salt of the earth type leadership,” ensuring the firm’s commitment to personalized service continues under new ownership.
Looking Forward
As trust services evolve and client needs become increasingly complex, SDTC’s combination of extensive experience, stable teams, and expanded capabilities through JTC Group positions the firm as a valuable partner for financial advisors. The company’s commitment to sustaining long-term relationships with both employees and clients, while expanding its jurisdictional reach, provides advisors with a trusted partner capable of serving their clients’ sophisticated trust needs across generations.
For financial advisors seeking a trust company partner, SDTC offers a compelling combination of experience, stability, and sophistication, backed by a proven track record of serving high-net-worth families across the globe. The firm’s recent strategic moves ensure it remains well-positioned to continue leading the trust industry while maintaining the personal touch and expertise that have defined its success.
_____________________
