Wells Fargo Advisors will focus on a mass affluent strategy this year, targeting clients with $250,000 to $1 million of investable assets and who preferably can become Wells Fargo bank customers, according to a report by Reuters last week.

Having a large retail presence will be critical for survival, according to Danny Ludeman, chief executive for the brokerage unit of the nation’s fourth-largest commercial bank.

The wealth management industry will eventually have a "barbell" shape, with a few giants on one end, lots of boutiques on the other end and nothing in between, Ludeman told Reuters.

"There are huge economies of scale in this business," he said. "With our scale and scope now, we can compete with anybody."

Wells is not likely to pursue new acquisitions for the time being, focusing instead on integrating its many legacy operations, according to Ludeman.

Wells Fargo’s 13 years of experience in offering a combination of banking and brokerage services give it an advantage in an environment where rivals such as Bank of America’s Merrill Lynch unit are scrambling to do the same, Ludeman said.

"We've been at this for a while,” he said in the Reuters interview. “We've been affiliated with a bank for a long time. It's not like trying to figure this out now."

Wells Fargo had 15,119 advisors at the end of the first quarter, just surpassing Merrill Lynch, which had 15,005 advisers.

Morgan Stanley Smith Barney remains the industry’s largest wirehouse with 18,140 advisers.