Wil u's NEWS Issue 11 December 1997 private banking 17 STERLING INTEGRITY •here are other organizarional challenges ïead. The 'pioneering' early days of IPB - characterized by an independent-minded staff - are now giving way to a new phase and a more cooperative ethos. More joint meetings to stimulate inter-office connections, and more 'peer review' sessions, are planned. There is potentially an inherent tension between a customers' expectations and the actual performance levels that a private bank can actually deliver. These expectations need Heinz Zimmer, Switzerland. to be managed - and this requires a judicious selection of the clients we admit to our portfolios. Similarly, business from certain regions such as the former Soviet Union must often be foregone, if only to maintain our reputation for sterling integrity. The catch phrase - above all - is 'know your customer.' KALEIDOSCOPIC MARKET Personal banking is a kaleidoscopic market. It is broken down into a wide number of broadly-defined categories defined by cultural geography and the source of the customers' assets. Many American clients, ^fc>r example, tend to have extensive inherited wealth, to be domestic in their focus, and to view their private banker as a 'sparring partner' with whom they can actively engage in the management of their own assets. Many potential Asian customers are reluctant to cede control of their assets to a trust; hence, the operations in Hong Kong and Singapore have hitherto acted primarily on an advisory and brokerage basis. In Europe, meanwhile, particularly among our existing customers, there is appreciation for a more 'social' approach in which the private banker takes a strong advisory and 'mentoring' role. IDEAL CLIENTS Indeed the majority of IPB's current customers fall into this latter category - and ^^hey are expected to do so for some time to ^Jnme. Their outlooks tend to mesh better with our own history and culture: they tend to be entrepreneurs who have built the businesses they own. Our ideal cliënt appreciates our solid triple-A status, our relative conservatism, and the cooperative nature of our organization as a whole. For them, strong personal contact with a private banker - together with the protection and maximization of their actual assets - are the essential elements that make up a successful banking relationship. The word relationship is key. In order to retain customer loyalty, IPB is committed to widening the base of products and services on offer. VALUE ADDING The three-fold goal vis a vis individual customers is to deliver absolute results, consistent performance, and a demonstrable level of added value: in short, to mobilize our knowledge in the customers' service. As our offerings climb up the scale from pure banking products to include independent investment, trust, and estate advice, as well as insurance and other products and services, the return both for clients and the bank will advance as well (see graph). 'This, of course implies that we can draw on know-how throughout the international network,' Van Rijckevorsel remarks. FEILDING THE TEAM IPB has meanwhile initiated a phase of geographic rationalization. Henceforth, for example, Zurich, which has expanded rapidly with three acquisitions in recent years, will take responsibility for IPB in most of Northern Europe including Germany. Geneva will look after customers in the South including Italy and lower France. Guernsey, now undergoing an important rationalization, will concentrate on UK and Anglo-Saxon oriented clients, while Luxembourg will focus on Dutch, Belgian, upper French and Cura^ao-based clients. It has also been designated a centre of competence for IPB-dedicated information technology systems; Zurich will assume a similar role as centre of competence for investment management coordination. RECRUITMENT DRIVES A continuing challenge is that of finding and keeping skilled staff. 'Our senior Chris Hayes, Singapore. managers have been spending an inordinate amount of time with recruitment drives. Looking ahead in the short-term, we need to adapt our renumeration structure and introducé financial incentives for top performance. Commissions could become a more important component of the private bankers' income-mix. But the limit to the number of candidates we can recruit and train autonomously remains.' CUSTOMER BASE For this and other reasons, it is evident that organic growth will be insufficiënt to fully deliver IPB's medium-term objective. While the process of targeting existing customers and further developing contacts that arise out of our activities within the RI network as a whole remains essential, they will not deliver economies of scale and scope on their own. 'The answer is clearly a policy of accelerated acquisitions,' says van Rijckevorsel. 'We are not talking about some kind of 'quantum leap' whereby we spend an inflated sum to buy a large and well-known player in our field. Instead, we plan to spend a modest sum to buy a number of medium-sized private banks that can not only augment our holdings but also bring a customer base that is fully in keeping with our own.' Product mix Return Banking Products Investment Products Trust Estate Insurance Others Private banking product mix

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blad 'What's news' (EN) | 1997 | | pagina 17