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Enhancing profitability Enhancing profitability through customer through customer
intelligenceintelligence
DEXIA BIL Private BankingDEXIA BIL Private Banking
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! DEXIA Group ! Private Banking � Key Business Challenges! DEXIA Private Banking - Strategy ! Applying Customer Intelligence! Conclusions
DEXIA Group & DEXIA Private Banking
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Flagship of business
InvestmentManagement
Services
Retail Financial Services & Bank
Insurance
Public & Project Finance
Pan-European
Geographical Scope of Franchise
DexiaCrédit Local
Paris
DexiaBank
Brussels
DexiaBIL
Luxembourg
Global Domestic
� Executive Management� Group Strategy� Central functions� Treasury Activities
Brussels - Paris
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DEXIA Private Banking - geographical breakdown
Jersey
France
U.K.Luxemburg
Belgium
Spain
Monaco
Singapore
Denmark
Switzerland:
Netherlands
Total Asset Under Mgt34 bn �
Private Banking in general � Business Challenges
The « Relationship Manager » - Challenges
FinancialMarkets Cycles
FinancialMarkets Cycles
Product Proliferation
Product Proliferation
Customer�s Increased Demand for More �Value�
Customer�s Increased Demand for More �Value�
ProductComplexity
ProductComplexity
Regulation/ DeregulationRegulation/
DeregulationInternal
OrganizationInternal
Organization
GlobalizationGlobalization
SophisticatedCustomer
Needs
SophisticatedCustomer
Needs
ComplianceCompliance
CompetitionCompetition
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Private Banking - CRM Strategy and Challenges
Totalcustomer
understanding
ProfessionalInvestment
Services
Focuson clients /
markets
Pro-activeorganisation
Customerknowledge
Investmentadvice
Focuson products
Opportunisticreferrals
From ToRisk profilingRelationship ManagementCRM supportedPatrimonial ApproachNon-discretionary / Advisory ServicesDiscretionary Asset ManagementNew ProductsCustomer added valueBank profitabilityIncrease of AUMSystematic customer acquisitionMulti channel strategy
Cultural changes needed
Desired Sales CultureTypical Sales Culture
� Collaborative/Team Selling� Sharing Information� Listening� Understanding Customer Needs� Customized Solutions� Learning Organization� Build the Relationship� Gain Commitment� Use of Technology Based Tools� Loyal Customer
� Fiercely Individual� Magic & Mystery of Sales� Guarding the �secrets�� Show & Tell� One Size Fits All� Competitive Organization� Make the Sale� Paper Customer Files� Telephone� Satisfied Customer
DEXIA Private Banking - Strategy
Towards Trusted Advisors and high recurring profits
Degree ofTrust with Client « Traditional
RM »« TrustedAdvisor »
Time
« Client Advisor »
Many Products, Improved margin
Solution-driven, high and
recurring profits
Buyer / Seller Cooperative Strategic Alliance
Single Products, low margin
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Private Banking Today � Three « revenue pillars »
STRUCTURAL STRUCTURAL ADVICEADVICE
STRUCTURAL STRUCTURAL ADVICEADVICE
LIQUIDITY LIQUIDITY ADVICEADVICE
LIQUIDITY LIQUIDITY ADVICEADVICE
FinancialPlanning and
CorporateEngineering
FinancialPlanning and
CorporateEngineering
INVESTMENTINVESTMENTADVICEADVICE
INVESTMENTINVESTMENTADVICEADVICE
InvestmentStrategies and
FinancialProducts
InvestmentStrategies and
FinancialProducts
Credit andLiquidity mgmt.
Credit andLiquidity mgmt.
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TIC is a « must have » solution
!Customer !R
elatio
nshi
p m
anag
er
!Management
EDM Product & markets
CRM
!Portal
Operations
MIS
Applying Customer Intelligence
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Current market situation Financial innovation Competition and cost reduction
Why Customer Intelligence in Private Banking? � a Profitable Must
Segmentation
Cross / up Selling Campaign Mgt
CHURNManagement
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HNWI
Personalbanking
Retailbanking
�The Four Rights�
RIGHTCustomer
RIGHTTime
RIGHTProduct/Service
RIGHTChannel
(Where) Investigation Scope - HNWI and Personal Banking
Tailor made
Segmentation
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(How) Customers segmentation based on Asset Alloc.
Customer / Business relateddatabases
Homogeneous clusterbased on asset allocation
SegmentationDatamining
Strategy
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(How) Define Strategy by segment
Relationship Manager
Top
Mgmt
CustomersS (AUM; ROA)
Strategy (Prod; Fiscal; Commercial)
S (AÛM; RÔA)
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(How) implement and support strategy every day!
Products Committee�Synthesis�Product Strategy�Validation & planification
� Information feedback fromcampaign analysis
Targetting / extract
ProductDevelopmentProduct def.
DWH
Campaign analysis�Transformation rate�Reasons of won lost�ROI
Stra
tegy
prop
ositi
on
Cust. Intelligencethrough
Data Mining
Market Spearhead
BRAINSTORMING
Analysis
�Products�Sales pitch�Target�Pricing�ROI
CommitteeStrategy
Campaign ManagementCommunicationCOMMERCIAL ACTION PLAN
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Results: Better ROA through Customer and Business Knowledge
!AUM�s!Segmentation
!Customer
Profitability
!Ratio Bonds / AUM�s
!Ratio SICAV/ AUM�s
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CONCLUSION
! Private Bankers are facing tremendous challenges :! KYC : quality and performance of service/products! AUM! Profitability! low cost
! Data Mining integrated in a CRM approach allows Private Bankers to better figure out Clients requirements and offers them in a more industrialway suitable products
! Keep in mind that one part of clients� psychology will remainunpredictable " Data Mining is an helpfull solution to better match clients� needs but is not a plug and play solution
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Enhancing profitability through customer intelligence @ DEXIA BIL Private Banking
Current market situation Financial innovation Competition and cost reduction
Cross / up Selling Campaign Mgt
CHURNManagement
Segmentation