Credit Suisse finds rich pickings among global entrepreneurs

Although the wealth management industry is undergoing radical change, those competing for the business of the richest individuals believe there will always be a role for the skilled private banker. 

“You would be surprised by the value we can bring to a client through one conversation,” says Claudio de Sanctis, head of International Wealth Management  (IWM) Europe at Credit Suisse. “Our advice is coming from a very non-conflicted point of view. We don’t have an agenda. Our aim is to help them grow their wealth, grow their business and grow their relationship with us. There is a phenomenal alignment of interest.”

IWM at Credit Suisse consists of two components – institutional asset management and international private banking. The private banking side has teams in Europe, along with emerging Europe, the Middle East and Africa and Latin America. IWM Europe is the largest private banking business in the division, managing SFr140bn ($141bn) in November 2017, more than a third of the global total, and close to a fifth of the entire Credit Suisse Group’s AuM. It returned to profitability in 2017, and saw 7 per cent in net new assets in the first three quarters of last year.

There are inevitably differences across these different markets, explains Mr de Sanctis, who joined Credit Suisse in 2013 and whose first posting was to Singapore, followed by a stint running private banking and wealth management in northern and eastern Europe. For example, the emerging market franchises are predominantly ultra high net worth-driven, given the type of wealth in those regions. 

But what is common for Credit Suisse’s approach across the geographies is a focus on entrepreneurs with an international outlook.  “Those clients come with a set of needs that are potentially more complicated and more sophisticated, and that is where we excel and where we have very little competition,” he claims. “This has been the focus of our strategy. Rather than trying to be the best bank for every segment in every geography, we have given ourselves a specific focus.”

Globalisation is changing the needs of these entrepreneurs, he adds, as few have a business 100 per cent contained within their domestic markets. 

“We can help them grow their enterprise, and this can be multi- faceted,” says Mr de Sanctis, who is now based in Zurich. “It can be buying other entities, it can be financing, or connecting them with like-minded entrepreneurs, suppliers or potential clients in other geographies.”

While Credit Suisse has bet heavily on three strategic markets – the UK, Spain and Italy – Luxembourg is also extremely important, particularly in light of the UK’s decision to leave the EU. The Grand Duchy is home to some of Credit Suisse’s advisory offices currently servicing Vienna, Amsterdam and Lisbon. “Luxembourg will become increasingly important to our operations,” he predicts. 

Additional booking platforms are based in Madrid, Milan, London and in Switzerland.  

Next generation

Credit Suisse has placed much emphasis on how best to engage with a younger generation of clients. In some geographies, for example pockets of Europe such as London, Berlin and Stockholm, this means targeting them as independent creators of wealth. But the riches that millennials will soon inherit are also significant.

“The vast majority of wealth we manage will, in a reasonably short amount of time, transfer to other generations. The millennials will be our clients. There’s no doubt that, as of now, they think and act in a different way.”

That means mastering new communication channels for a generation of digital natives. 

Indeed, up to a certain level of wealth, digital will probably deliver a better wealth management experience to clients, says Mr de Sanctis, as the overall cost of providing services makes it almost impossible to provide a one to one tailor-made personal service that is competitive with what a “proper algorithm” can deliver.

But the other end of the spectrum is a different proposition. “I believe UHNW clients will never, under any circumstances, say they want a 100 per cent digital relationship,” he insists. “Does that mean they will not expect a heavy digital component in their experience? Absolutely not. Of course they will.”