Global Private Banking Awards 2016: Winners’ Profiles – National Winners (Middle East)

Best Private Bank in Turkey
Akbank Private Banking

Akbank was founded as a privately-owned commercial bank in Adana in 1948 to provide funding to local cotton grower. Today, the group has an extensive network of more than 900 branches across Turkey, and provides private banking services from dedicated branches located in the main cities.

According to Didem Bağrıaçık, private banking senior vice president, Akbank Private Banking enjoys a market leading position in the sector, with a successful business model that benchmarks itself against global wealth management firms and private banks. “This sets us apart from our competitors. Our vision is going one step further, to compete with global players with our products and services,” she says.

Akbank focuses on the core values of its target audience and the “emotional benefits” of private banking. It considers personal wealth not as an individual quality belonging purely to the present, but as something that must be expertly managed to ensure its future sustainability. 

With this in mind, the bank launched its ‘Next Generation Programme’, in collaboration with Sabancı University. The programme, the first of its kind in the country, aims to educate new generations on subjects such as the responsibility that comes with family wealth, investment diversification, risk management and philanthropy. It also allows the bank to build customer loyalty through generations. “While providing the professional assistance on family wealth and financial solutions, we also strengthen the social bonds with our clients and their families,” explains Ms Bağrıaçık.

Akbank Private Banking offers core banking products, along with alternative financial solutions to clients who require a greater level of specialisation. Through AK Asset Management, it also develops customised structured products based on client’s risk appetite and return expectations. 

The bank is currently working on an IT project, PM1, to develop a sophisticated and detailed reporting system that clients can access via mobile and internet banking. PG

Best Private Bank in the UAE
National Bank of Abu Dhabi

The National Bank of Abu Dhabi (NBAD) Global Private Banking aims to become “the reference private bank for and of the Arab World”.

The bank has won the best private bank in the UAE award for five consecutive years. According to Ashraf Mazahreh, managing director and head of private banking UAE, this recognition is “a testimony to our capabilities and commitment to provide diversified opportunities and innovative tailor-made global investment solutions to our clients”.

Over the last few years, NBAD’s focus has been on key areas such as attracting top talent, expanding their international footprint and developing leading regional and international investment competences. Its global approach is reflected in the unification of private banking business across four geographical areas – UAE, Egypt, the UK and Switzerland – into one global team.

“NBAD has always taken pride in providing its clients with best-in-class products and wealth solutions, whether it is capital preservation or enhancing investment yields,” he says. Recently, and in response to market conditions, the bank has expanded its product offering, to include yield-enhancing solutions and specialist funds, both managed in-house or by third parties. 

It has also launched capital-protected investment solutions for clients “keen to minimise downside risk, yet maintaining a satisfactory level of exposure to financial markets”.

“Our key strategy will be focused on continuing to build and deliver on our core value proposition, in terms of our offshore booking abilities, regional and international product offering and wealth advisory,” explains Mr Mazahreh.

This summer, NBAD announced plans to merge with First Gulf Bank, to create the largest bank in the Middle East and north Africa. “This will be a key driver to reinforce our clients’ trust and establish higher standards of excellence in the field of private banking,” he adds. PG

Best Private Bank in Bahrain
Ahli United Bank B.S.C.

Ahli United Bank (AUB) has 137 branches across Bahrain, Kuwait, Egypt, Oman, Iraq, Libya and the UK. As of December 2015, the bank served 6952 private banking clients, a slight drop on the previous year following AUB’s decision to transfer some individuals to a premium or retail relationship. Assets under management stood at $3.8bn, lower than the previous year, mainly due to the depreciation of sterling and the euro versus the dollar.

In Bahrain itself though, where AUB has won this award for the third year in a row, the bank saw a 6.5 per cent rise in the number of private clients, while AuM was also up by 7.5 per cent.

AUB’s focus in 2015 was to implement its strategy of ‘creating value through segmentation’. The bank is placing a special focus on the ultra high net worth segment, and is specifically targeting younger investors in the hope of fostering long-lasting relationships. Products in areas such as Sharia-compliant investments, UK commercial real estate and US residential property, as well as in private equity and utilising club structures were examples of new launches which provide an increasingly diverse range of investment solutions to its clients. 

“Our plan for the future is to organically grow the private banking business through increasing our presence in key countries in the region,” says Prakash Mohan, group head of corporate banking, giving the establishment this year of an operation in the Dubai International Financial Centre as an example. 

“We are also focused on increasing our share of wallet within the target client base through enhanced relationship management coupled with ongoing development of our product and service capabilities.” ES

Best Private Bank in Lebanon
Audi Private Bank

In a region where relationships matter greatly, in business as well as in personal life, Audi Private Bank, part of Lebanon’s Bank Audi sal, is rightly proud of the high average tenure of its private bankers, at nine or 10 years. 

“The long tenure of relationship managers at our bank is a great advantage as it ensures continuity in business relationships with the client,” says a spokesman for the private bank, which has 4.269tn Lebanese pounds ($2.82bn) under management. “With time, the relationship manager acquires a deep knowledge of his client, has been aware of his preferences, life stages and changes, and can better serve him in terms of suitability and appropriateness. Also, this makes these relationships smoother, and based on trust and mutual respect and appreciation, which makes communication with our bank much more pleasant and efficient.”

The bank achieves this long tenure through “building long term relationships with our employees”, according to the spokesman. Relationship managers are remunerated and rewarded based on stability of AuM, client loyalty and referrals. “There is a focus on the long term, rather than on specific amounts of yearly commission and fee targets,” adds the spokesman. 

Home-country clients of Audi Private Bank, which particularly targets customers with between $1m and $20m, face very different challenges from high net worth individuals in developed markets, and the bank has responded accordingly. “Given that interest rates are quite high in Lebanon, for both US dollars and Lebanese pounds, it is with no surprise that our clients are yield-hungry and extremely demanding in terms of income generation,” says the spokesman. 

“Hybrid bonds have thus been stellar instruments in our bank,” he adds. “We have thus responded to growing client demand and have created this structure where we have between 20 to 25 single lines of hybrid bonds, targeting a yearly income of about 6 per cent.” DT

Best Private Bank in Qatar
Best Private Bank in Russia
Credit Suisse

Credit Suisse has built up a strong presence in Russia since establishing onshore operations there in 1993. It has a particular focus on entrepreneurs, who benefit greatly from the huge size of the group as a whole. For example, the investment banking unit provides financial advisory and capital-raising services, as well as sales and trading services, including block trading on the Moscow exchange.

“The main challenge our Russian clients face is the changing regulatory environment, with a number of new regulations and legal amendments requiring adaptation to the new standards, as well as current international sanctions,” says Robert Cielen, head of emerging Europe at Credit Suisse. “The country is experiencing an economic recession, with a devaluation of Russian currency and a decrease in oil prices.”

In Qatar and other Middle Eastern states, Bruno Daher, CEO of Emea at Credit Suisse, thinks life is getting more complicated for the wealthiest clients – and the bank is responding accordingly.

“Clients from the higher private banking segment in these markets increasingly require close support and advice on complex situations,” he says. 

“We address their needs by offering an integrated approach: onshore and offshore solutions and coverage, comprehensive use of both sides of the balance sheet, and integrated bank solutions. Furthermore, these clients are looking to diversify their businesses into other areas to ensure growth, sustainability and wealth for generations to come.”

Eleven per cent of the group’s total private client AuM of SFr681bn ($696.7bn) is accounted for by clients in the Middle East and Africa. 

Bearing in mind the needs of Middle Eastern clients, the private bank has a special strategic asset allocation for this group, differing from European clients by reflecting more accurately the risk appetite and return expectations prevalent in the region, says Mr Daher. 

“For example, a Middle Eastern fixed income investor would be more inclined to have a significantly higher allocation to emerging market bonds than a European fixed income investor.” DT

Best Private Bank in Egypt
Best Private Bank for US Customer Service
Best Private Bank for UHNW clients
Citi Private Bank

Targeted at the wealthiest segment of the world’s population with more than $25m to invest, requiring a “high touch” relationship, Citi Private Bank is expecting the most significant growth in managed assets to come from Asia. “Entrepreneurs are all around the world. There is no shortage of people willing to strike out and we position our brand to help serve them,” says Peter Charrington, global CEO of Citi Private Bank.

He warns the competition, many of whom are selling their franchises and retrenching as national players, that it will be difficult to keep up with the cross-border banks currently making the running.

“A lot of them do not manage their cost-income ratios and they lose focus; we will see this trend continue,” warns Mr Charrington, who says banks need to define their proposition and exactly what they are offering to clients. “People are coming into the industry with high costs and regulation, so they need to be focused on who they are serving in terms of types of clients. If they are trying to be all things to all
people, then it’s a very difficult proposition. At Citi Private Bank, we have remained steadfast in our vision, execution of that vision and the segment of clients we serve. This has benefited us, but most importantly, it has served our clients well.”

Part of the answer to redefining the business model has been judicious use of new technology and the US bank has been one of the most pro-active in rolling out a digital communication channel across the regions where it has strongest penetration. Its ‘Project Sheen’ led to the redesign of the entire customer experience, including receptions and meeting rooms, as well as digital interfaces such as the InView system. 

This process is one of constant re-valuation and is definitely not static, says Mr Charrington, who chairs a working group that regularly looks at glitches in the system and evaluates customer feedback before making more tweaks to the digital platform. 

Although there was originally talk within Citi about breakneck technological innovation, staying ahead of competitors, the thinking has recently been modified, with the artificial intelligence pioneered by the likes of Singapore’s DBS and the Korean banks seen as a potential step too far for the wealthiest clients. Mr Charrington is adamant that these people come to his bank for one-to-one advice, which is the key tenet of customer service. 

“We don’t see ultra high net worth investors going for robo-advice. Our technology and digital experience is very high quality, but people are still our most important ingredient. The more wealth you have, the more that becomes important. Digital is not the only component.”

In the US, each banker serves just 30 clients. “Our definite aim is to keep this number small,” says Tracey Warson, head of North America at Citi Private Bank. “The more wealth a family has, the more complex the needs are.” YB