Last year marked yet another record in the number of deals and total client assets exchanged in the registered investment advisor industry — and that’s likely to continue in 2022, according to a recent report.

The industry saw 307 deals in 2021, a jump of around 50% over the 205 deals in the prior year, according to Echelon Partners‘ RIA M&A Deal Report 2021 Annual Report and 2022 Outlook.

Last year was also the ninth consecutive year in which the number of transactions grew, says the boutique investment bank focused on M&A and succession planning for the wealth and investment management industries.

The deals also grew in size last year, when the average seller had more than $2 billion in client assets for the first time in the history of Echelon’s reporting. In all, 145 transactions involved firms with $1 billion or more in client assets.

A total of $576 billion in client assets changed hands in 2021, an increase of almost 81% over 2020, Echelon says.

Wells Fargo‘s sale of its asset management unit to Reverence Capital and GTCR, announced in February, was the biggest deal of the year, representing $603 billion in client assets, according to the report. That was followed by Ascensus‘ merger with The Newport Group, which represented $500 million, and Prudential Retirement‘s sale of its full-service retirement business to Empower Retirement, which represented $314 billion, Echelon says.

Activity among strategic as well as financial acquirers hit new records, although financial acquirers remain the dominant players for the largest practices, according to the report. M&A activity by RIAs, meanwhile, declined from 79 deals in 2020 — representing close to 40% of the total, making RIAs the most active category in the space — to 70 in 2021, or only around 23% of the total, Echelon says.

But banks still represent the least active category, with none of the bank acquirers announcing more than one deal last year, although seven of the nine deals by banks involved $1 billion in assets or more, according to the report.

Echelon managing partner and chief executive officer Dan Seivert said in an announcement that Echelon believes there will be “continued demand for wealth management M&A from industry participants,” despite inflation — and therefore the likelihood of a rate hike — and other macroeconomic risk.

According to Echelon, deal activity will be “robust” this year because low financial costs should remain in place despite a “hawkish Fed,” combined with the prospect of even more private equity dry powder, which is expected to reach a record $714 billion this year.

Moreover, Echelon expects U.S. wealth management firms, including Wren Sterling, AFH Financial and Focus Financial subsidiary Connectus Wealth Advisors to spearhead consolidation overseas.

Echelon also sees heightened interest in cross-selling opportunities between retirement plan services and wealth management and therefore more deals such as Creative Planning acquiring Lockton‘s retirement practice, which added $100 billion.

Echelon also expects increased interest in the WealthTech space, pointing to JPMorgan CEO Jamie Dimon recently announcing the firm’s plans to put $12 billion toward technology this year.