Interact
Member access
Browse
SuperInvestor TV
Share
» Articles - Emergence of Nouveau Classic banking
Emergence of Nouveau Classic banking
Since the establishment of SuperInvestor, we have been encouraging service providing members and those requiring professional services to get know each other, understand skills of those providing services and information requirements of those needing advice. On the basis of understanding, commence a business relationship. The encouragement was based the need to manage investments during bull and bear periods. The approach to doing business in this way was based on in excess of 70 years extensive local and international commercial and professional relationship on doing business in public and private sectors.
This approach has now been confirmed by the PricewaterhouseCoopers a Global Private Banking and Wealth Management Survey of 2009. The results show that “The trusted relationship, the very foundation of wealth management, has been damaged. Clients are feeling bruised and have become disillusioned with financial institutions. There is a sense that some wealth managers might have placed short-term revenue goals – and not client interests – at the heart of their businesses” (1). As a consequence client loyalty has declined and indeed this has also been the experience of some SuperInvestor members. The survey shows that clients are now raising the bar, demanding higher standards of service and advice, coupled with simplicity and transparency. They want to understand precisely what they are investing in, where it is held, how it is valued and what is the management process that takes advantage of opportunities and reduces the downside risks.
This poses challenges for wealth managers, not least of which is the level of transparency that clients require. With markets likely to remain volatile for some time, clients will demand that information on their exposures is readily available. Yet many wealth managers simply cannot provide real-time data. In volatile markets, the inability to provide a higher level of transparency dramatically impacts on an institution’s ability to be a true ‘trusted advisor’. We see this as an historic crossroads for the industry. Clients are not looking for complex products, promising high yield, but rather trusted and independent advice that can address their needs both in the short term and longer term.
The economic crisis has presented Client Relationship Managers (CRMs) with challenges that they have neither the experience nor the skills to deal with. If quality of advice is the real differentiator, then wealth managers need to arm their CRMs with the relevant skills, tools and training so that they can fully meet the needs of their clients. Wealth managers can no longer afford to be all things to all people. They need to be clear both on where in the market they can win and where they want to participate. Service offerings need to be tailored across all segments. Only then can wealth managers deliver services in a profitable manner, which meet the needs and expectations of clients. It is a time for change – redefining the delivery of trusted advice within wealth management.
I think this change represents the emergence of ‘Nouveau Classic’ banking.
Vas Banschikov
www.SuperInvestor.com.au
Now that you have read this, what do you think? Do you have other ideas? Please share you views with other members (eg by blog or discussion form) and/or request professional member(s) to contact you directly.
(1) Source: PricewaterhouseCoopers Global Private Banking and Wealth Management Survey 2009.
