Switzerland

Details

  • Service: Financial Services
  • Industry: Banking
  • Type: Business and industry issue, Survey report
  • Date: 11/5/2013

Private Banking Survey 2013: Success through innovation 

Achieving sustainability and client-centricity in Swiss private banking

 

The transformation of Swiss private banking continues. Changing client demands, the emergence of new technological preferences, and ongoing regulatory developments are some of the huge challenges facing banks. Technology's influence, the market's consolidation as well as the increasing "open architecture" for products are all factors dissolving the value chain.

So what should a successful business model look like in the future?

KPMG’s private banking survey 2013 spotlights the business model areas that should be of central concern. It discusses innovation, markets, independent asset managers, clients, products and services, pricing, operations, governance and control to derive priorities for private banks.
Markets

Markets

Priorities:
  • Ensure the bank's geographic strategy is viable given regulatory and cost constraints.
  • Apply “Enterprise Risk Management“ principles to the risks of entering a new market and measures to ensure a sustainable and profitable business. Plan to implement an AEI program in the bank's major countries.
Clients

Clients

Priorities:
  • Develop clear steps to reinforce the bank’s client-centricity strategy, strengthening the differentiators in client service with particular regard to new client segments.
  • Collect more comprehensive and detailed data on clients for the purpose of a dynamic segmentation. Identify clients’ touch points.
  • Make use of behavioral analytics for bundling service/product offers.
Products and services

Products and services

Priorities:
  • Adjust product and service focus in line with the bank’s strategy to become an advisory, technology, production or hybrid leader.
  • Advisory leaders should better capture clients’ needs in order to choose from open architecture the most suitable products and develop tailored services. Universal banks should further leverage retail or investment banking products to provide a holistic offering.
  • Keep abreast of attitudes to online solutions and communications.
Asset Managers and private banks

Collaboration between Independent Asset Managers (IAMs) and private banks

Priorities for private banks:
  • Benchmark attractiveness as custodian bank and/or provider of additional services against that of other banks.
  • Apply extensive due diligence to mitigate onboarding risks and identify upside potential. Ensure governance processes for existing relationships are robust.

Priorities for IAMs:
  • Consider choice of bank based on a combination of client profiles and preferences, bank brand, services, costs, IT platform and international connectivity, inter alia.
  • Monitor existing bank relationships and analyze potential new ones to ensure ongoing strategic and operational fit.
Innovation

Innovation

Priorities:
  • Acknowledge that the “old normal” is gone and embrace the imminent transformation period as an opportunity.
  • Ensure value proposition meets future demands, is truly client-centric, benefits from scale effects, and offers best-in-class products and services.
  • Take initiative at industry-level, reviving Swiss private banking’s brand by strengthening the values its global clients demand including stability and service quality.
Pricing

Pricing

Priorities:
  • Identify pricing models that best suit clients' profiles and needs by strengthening data collection and analysis.
  • Introduce compliance risk and behavioral data analysis into pricing models.
  • Develop clear pricing communications to ensure clients understand and accept new pricing models.
Operations

Operations

Priorities:
  • Eliminate unnecessary operations. Outsource processes that are non-core to the bank’s value proposition. Automate remaining processes where applicable.
  • Seek industry-level collaboration to create scale and reduce excess capacities and industry-level redundancies (e.g. through shared services).
  • Support client-centricity and productivity enhancements by revising job descriptions, wage levels and structures accordingly.
Governance and control

Governance and control

Priorities:
  • Develop “Road to Compliance” concept to cover upcoming regulatory requirements, mitigate compliance risks and ensure systematic, cost-efficient introduction of compliance measures, exploiting synergies by leveraging existing processes.
  • Support people in making the change. Motivate by leading by example and transparently announce major changes in strategy, communicating regarding impacts.
 

Philipp Rickert

Philipp Rickert

Partner, Head of Financial Services

+41 58 249 42 13

Hans Stamm

Hans Stamm

Partner, Audit Financial Services

+41 58 249 34 98

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