8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
1/31
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
2/31
2CBI
V 1.0
2CBI
V 1.0Wealth Management2 lessons @ 45 min.
Guest Speaker
Marc Lussyobjtec GmbHSenior ManagerSchoenenbergstr. 1008820 Waedenswil ZH
More than 20 years experience in Banking
Trader, Relationship / Portfolio Management and Project Manager
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
3/31
3CBI
V 1.0
3CBI
V 1.0Wealth Management2 lessons @ 45 min.
Why do wealthy individuals needadvice to manage their assets?
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
4/31
4CBI
V 1.0
4CBI
V 1.0Wealth Management2 lessons @ 45 min.
October: This is one of the particularly dangerous months to speculatein stocks. The others are July, January, September, April, November,May, March, June, December, August and February. Mark Twain
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
5/31
5CBI
V 1.0
5CBI
V 1.0Wealth Management2 lessons @ 45 min.
Market shares global AuM(on- and offshore)
1
Total around 110 trillion USD
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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6CBI
V 1.0
6CBI
V 1.0Wealth Management2 lessons @ 45 min.
Market shares AuM offshore
Total around 7 trillion USD
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
7/31
7CBI
V 1.0
7CBI
V 1.0Wealth Management2 lessons @ 45 min.
Importance of Wealth Managementfor a Global Bank
Core Results Credit Suisse by Division in Billions 2007 - 2010
-15
-10
-5
0
5
10
Private Banking
Investment Banking
Asset Management
Shared Services
2007 2008 2009 2010
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
8/31
8CBI
V 1.0
8CBI
V 1.014 Wealth Management...2 lessons @ 45 min.
Roles in Wealth Management
RelationshipManager(RM)
PortfolioManager
Analyst Trader
InvestmentConsultant
TaxSpecialistFinancial
Planer
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
9/31
9CBI
V 1.0
9CBI
V 1.0Wealth Management2 lessons @ 45 min.
Role Relationship Manager (RM)
Relationship managers are the customer service giants that own thecustomers, know everything about them, manage that knowledge as anasset, and are able to meet the full complement of financial needs. [Ernst& Young ]
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
10/31
10CBI
V 1.0
10CBI
V 1.0Wealth Management2 lessons @ 45 min.
Key Activities of an RM
Client retention
Make sure that existing clients stay with the bank
Client selection Identify profitable clients
Client Acquisition Increase client base
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
11/31
11CBI
V 1.0
11CBI
V 1.014 Wealth Management...2 lessons @ 45 min.
Key skills and Know-how neededto be a successful RM
Profound product know-how
Social Skills
Sales Skills
Knowledge of compliance regulations
Know-how IT Tools
V
VW l h M
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
12/31
12CBI
V 1.0
12CBI
V 1.0Wealth Management2 lessons @ 45 min.
Mandate types 1/3
Advisory Mandate Client makes investment decisions himself
RM provides specialists expertise and currentmarket information
Client follows the markets on a regular base
V 1 0
V 1 0W lth M t
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
13/31
13CBI
V 1.0
13CBI
V 1.0Wealth Management2 lessons @ 45 min.
Mandate types 2/3
Trading / Investment Consulting Mandate Client makes investment decisions himself
Short term approach Active Trading
Market sentiment is more important than fundamentals
Relationship Manger / Investment Consultant provides trading ideason a daily base
Client follows the markets on a daily base
V 1 0
V 1 0W lth M t
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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14CBI
V 1.0
14CBI
V 1.0Wealth Management2 lessons @ 45 min.
Mandate types 3/3
Discretionary Mandate Relationship / Portfolio Manager makes investment decisions
Relationship Manager informs the client several times per yearabout development of the portfolio
Client does not need to follow the markets
V 1 0
V 1 0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
15/31
15CBI
V 1.0
15CBI
V 1.0Wealth Management2 lessons @ 45 min.
Types of banks in Wealth Management
Global banks with private banking units
Traditional offshore focused private banks
Traditional onshore focused private banks
Retail or affluent focused local banks
V 1 0
V 1 0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
16/31
16CBI
V 1.0
16CBI
V 1.0Wealth Management2 lessons @ 45 min.
Classification of clients Onshore (assets are managed in country in which owners of assets are resident)
Offshore (assets are managed country in which owners of assets is not resident)
Retail
Institutional
Affluent (less than $1million but more than $100,000 )
High Net Worth Individuals ($1million to $50 million)
Ultra High Net Worth Individuals (more than $50 million)
V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
17/31
17CBI
V 1.0
17CBI
V 1.0Wealth Management2 lessons @ 45 min.
Advisory approach Analysis Financial concept
Profile Strategy Implementation
V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
18/31
18CBI
18CBI
Wealth Management2 lessons @ 45 min.
Advisory approach - Analysis
Investments Get an idea of size and asset types
Wealth creation Inflows such as earnings on assets, salaries, expected inheritance
etc.
Liabilities Current and future financial obligations
Expenditures
Living costs, regularly payments, tax payments etc
V 1.0
V 1.014 Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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19CBI
19CBI
14 Wealth Management...2 lessons @ 45 min.
Advisory approach Financial concept Channeling and visualization of gathered information including clients
asset and liabilities, annual income and annual spending
The financial concept must reflect the clients overall situation
Allows the RM to provide his client a personalized investment solution
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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21CBI
21CBI
Wealth Management2 lessons @ 45 min.
Advisory Approach Client profile 2/3
Risk abilityIt defines clients ability to cope with financial losses without a noticeable
effect on their standard of living
Risk toleranceIt defines how a client deals emotionally with investment risks
V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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22CBI
22CBI
Wealth Management2 lessons @ 45 min.
Advisory Approach Client profile 3/3Service profileIn order to suit different client requirements it is very important to
understand which services he needs and to define an according serviceprofile
Possible service profiles are:
Advisory mandate Investment consulting Discretionary mandates
V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
23/31
23CBI
23CBI
g2 lessons @ 45 min.
Advisory Approach Strategy
Risk profile Investment strategy
Low
Moderate
High
Enhanced
Medium
Fixed-income
Income-oriented
Balanced
Captial-gains-oriented
Equitities
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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25CBI
25CBI
g2 lessons @ 45 min.
Wealth Management the past Strong banking secrecy
Main goal of a lot of clients was tax optimization
Performance of limited importance
Clients had limited access to market information (
Newspaper)
Clients were loyal to the their bank
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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V 1.0
V 1.0Wealth Management
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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27CBI
27CBI
2 lessons @ 45 min.
. . . the future
?
V 1.0
V 1.0Wealth Management2 l @ 45 i
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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28CBI
28CBI
2 lessons @ 45 min.
CRM Tools in Wealth Management 1/3
Operational CRM market operation
Analytical CRM
V 1.0
V 1.0Wealth Management2 l @ 45 i
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
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29CBI
29CBI
2 lessons @ 45 min.
CRM Tools in Wealth Management 2/3
Portfolio
Issues
- Get a new copy of passport due 25.5.11
- Needs to sign risk disclosure due 31.12.11
- Invite for gulf turnament
Performance
Remarks05,1,11Became father
10,2,11Would like to invest in commodities
15,3,11Plans to transfer more money
20.4.11Wife had car accident
Client dataName
Birthday
Riskprofile
Cliensince
Monthly reports
Hobbies
Name wife
Number of Children
Responsibel RM
Relations with other clients
V 1.0
V 1.0Wealth Management2 lessons @ 45 min
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
30/31
30CBI
30CBI
2 lessons @ 45 min.
CRM Tools in Wealth Management 3/3
Where can a CRM add value?
Measure activities
Analysis of current situation
Identification of target clients
Manage sales activity
Quick access to client information
Consulting
V 1.0
V 1.0Wealth Management2 lessons @ 45 min
8/4/2019 Wealth Management May2011 School of Business Administration HEG-FER Fribourg Marc Lussy
31/31
31CBI
31CBI
2 lessons @ 45 min.
Wealth Management . . . the futureThreats Weaker banking secrecy
Regulations Decreasing margins Increasing costs Increasing quality standards
The way forward New markets (BRICS / Emerging Markets) Increased effort for client retention
Increased tool support (CRM, product selection) BPO (Business Process Outsourcing) Mergers / take overs of smaller banks
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