Private Bank

PRIVATE BANKING IN EUROPE – Getting Clients & Keeping Them!

Philip MOLYNEUX

SBARD, University of Wales Bangor, Hen Goleg, College Road, Bangor, Gwynedd LL57 2DG, United

Kingdom, p.molyneux@bangor.ac.uk

Anna OMARINI

Department of Business Administration, Institute of Financial Markets and Institutions "G. dell´Amore",

Università Bocconi, via Sarfatti 25, 20136 Milano, anna.omarini@unibocconi.it

Abstract

The paper examines the features of private banking business in Europe and focuses on the key roles of client

segmentation, retention and acquisition. There has been substantial growth in private banking business over

the last decade or so as commercial banks have targeted both the 'mass-affluent' and more upmarket high net

worth individuals (HNWI’s). The combined amount of investable assets at the disposal of these two groups

amounts to around Euro 6 trillion and a wide range of banks, investment firms and other operators have

focused on devising strategies aimed at grabbing a share of this potentially lucrative market. The private

client wealth management industry in Europe remains relatively fragmented although a few major players

have emerged and consolidation is an ongoing theme in the sector. Given the commercial opportunities

afforded by this business area the increased complexity of clients needs continues to be a critical strategic

issue for industry participants. This paper illustrates important themes relating to the wealth management

service proposition and focuses on client segmentation, retention and acquisition strategies. Overall we find

that private banks will have to adopt a more systematic approach to these areas and in particular also have to

pay greater qualitative and quantitative attention to client satisfaction, trust and loyalty issues if their client

retention and acquisition strategies are to be a success.

Keywords

Private banking, wealth management, segmentation,

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Introduction

Private banking...