Key Points:
- Bank of America is starting a specialized art consulting service.
- Wealthy clients hold over $2.5 trillion in art assets globally.
- More collectors are using art as collateral to secure loans.
- Younger generations are expected to inherit one-third of these collections.
Bank of America is rolling out a new consulting service designed specifically for its wealthiest clients who collect art. The bank aims to help these high-net-worth individuals navigate a changing market where paintings and sculptures are increasingly treated as powerful financial tools rather than just decorations.
The move comes as the value of art held by private collectors reaches astronomical levels. According to a report by consulting firm Deloitte, the world’s ultra-wealthy held about $2.56 trillion in art in 2024.
Experts predict that figure could climb to $3.5 trillion by the year 2030. With so much money hanging on the walls, banks and family offices are preparing for a massive transfer of wealth. They expect about one-third of these valuable collections to pass down to younger generations over the next ten years.
Drew Watson, the head of art services at Bank of America, says the new consultants will work directly with clients at the bank and its Merrill Lynch division. He notes that tastes are shifting as new collectors and heirs enter the market. The consultancy aims to help these clients choose pieces that fit their personal aesthetic while also keeping an eye on potential value growth.
A major driver for this service is the rising demand for loans backed by art. Wealthy individuals often use their collections as collateral to get cash for other business ventures. This allows them to access liquidity without having to sell their prized possessions. Deloitte reports that 70% of wealth managers saw an increase in demand for these types of loans last year.
Bank of America already manages one of the largest portfolios of art-based loans in the industry. Watson explains that while the bank views art as property rather than a standard asset class like stocks, the financial implications are huge. “It’s a very interesting moment to look for new long-term trends,” Watson said. By offering expert advice, the bank hopes to guide clients through these changes and manage their unique assets more effectively.
