Swiss and US names dominate private banking brand rankings

Wealth management is undergoing a period of serious transformation. A number of private banks have been hit by heavy fines for failing to comply with tax rules, new banking regulation across the world is making global banks reconsider their international presence, and new technology and clients’ attitudes towards self-directed investment platforms have opened the door to new challengers. Nevertheless, when looking at the value of private banks’ brands, it is still the established names that dominate.

Compiled by consultancy Brand Finance, PWM’s sister publication The Banker’s ranking of the 50 private banks analyses annual data up to January 1, 2015, and takes into consideration wealth management businesses only, excluding any asset management activities. This year’s ranking shows Switzerland-based UBS as the clear leader, with a brand value of about $6.17bn (€5.56bn) – a figure one-third higher than its previously recorded value in 2014, and $1.4bn higher than second placed Deutsche Bank.

The valuation represents the royalty fee that a third-party would have to pay to use the brand, and is based on historic and forecasted financial results, asset strength, market share, as well as on emotional factors such as familiarity and general brand satisfaction, as scored by clients and collected by independent data providers.  

UBS’s Swiss counterparts recorded flatter growth. Credit Suisse grew by 6 per cent, while Julius Baer grew by just 2 per cent. “Results in Switzerland were lumpy: some of the brands are doing quite well, some others are not doing so well,” says Bryn Anderson, Brand Finance’s chief operating officer. He attributes UBS’ success to its focus on core markets and businesses.

Other Swiss brands that enjoyed double-digit growth were Banque Privée Edmond de Rothschild and Sarasin, having recorded 27 per cent and 28 per cent valuation growth respectively. Elsewhere, a handful of players increased their brand value by an even larger percentage than UBS. Commonwealth Bank of Australia grew by 49 per cent as it expanded into Asia. 

Taiwan’s Taishin also improved its trademark value by 49 per cent, with the growth of its wealth management business helped by a favourable regulatory environment, as well as the bank’s efforts to be perceived as a trusted name, according to Savio D’Souza, associate director at Brand Finance. “Taiwan has significantly deregulated the market for wealth management products. A mainland Chinese client can now bank with a Taiwanese bank, and that has helped [Taishin and other local banks] quite a lot in terms of revenue growth,” he says.

Also of note is Lloyds Bank’s improvement, with its valuation increasing by 47 per cent. The UK-based bank’s wealth management division has benefited from a group restructuring, and from focusing on a profitable share of the local market, where its brand is highly recognisable. 

Mr Anderson says: “Lloyds has rationalised the business, focusing on the UK only, typically on business owners with high disposable income and older customers, who are more likely to use wealth management services. It cross-sells much better from the retail base than other banks within the UK.”

The ranking predominantly features brands from developed countries, with only four emerging market names. The highest ranking is China’s ICBC, in 17th place, followed by China Construction Bank in 25th and Singapore’s DBS in 27th. Singapore continues to offer fertile territory for wealth managers, says Mr D’Souza, in line with its ambitions to grow as an international financial centre serving Asia.