Wealth Management in Switzerland 2009

Content

• Overview
• Catalyst
• Summary
• Methodology
• Executive Summary
• Switzerland Is at The Center of Changes in The International Wealth Management Business
• Swiss Investors Have Acted More Defensively over The past Months
• There Are Important Differences in Swiss Hnw Attitudes That Wealth Managers Need to Cater for
• Wealth Managers Need to Consider The Overlooked Area of Advisory Services and Step up The Frequency of Their Client Contact
  • Table of tables
• Special Feature: The End of An Era in Global Wealth Management?
• Switzerland Is at The Center of Changes in The International Wealth Management Business
• Economic Circumstances Are Driving A Re-Examination of Global Wealth Management Practices
• US Court Action Is Only One Attack on Switzerland's Status
• The G20 and Oecd Have Brought Further Damage to The Swiss Model of Banking
• Increasing Wealth in Non-Western Markets Is Fuelling Growth in Wealth Management in Those Countries and in The Process Creating A More Competitive International Wealth Management Landscape
• Ubs Has Been Damaged by A Number of Difficulties but Is Still Standing
• There Is No Doubt That The Image of Ubs Has Been Tarnished by The Bank's Troubles
• The Need to Be Bailed out Has Further Undermined Ubs's Standing
• Ubs's Biggest Threat Is Now The Damage Caused by Its Misconduct in The US
• Wealth Managers in Switzerland Do Not Believe That Ubs Has Been Irretrievably Damaged
• Ubs Management Is Aiming to Return to Profitability in 2009
• Ubs Still Faces An Uncertain Future
• There Are Unique Opportunities for Wealth Managers to Profit in This New Environment
• These Opportunities Should Be Explored at The Same Time as Wealth Managers Work to Lift Brand, Image and Reputation
• Wealth Management Opportunities in A Downturn Need to Revolve around Boosting The Company Profile
• Actively Recruit Good Relationship Managers from Competitors
• Leverage CRM Systems to Identify New Wealth Management Clients
• The Media Can Be Used to Raise The Public Profiles of Both Individuals and The Financial Institution
• The Onshore Market for Wealth Management Remains Significant and Unaffected by Challenges to The Swiss Banking Model
• The Structure of The Wealth Management Industry in Switzerland May Be Set to Change
• Expansion Abroad Is A Key Strategy for Developing The Wealth Management Business
• Swiss Wealth Managers Should Exploit Their Strengths to Position Themselves Strategically Globally
• IT Is The End of An Era for Wealth Management but There Is Still A Leading Role for Switzerland
• Switzerland's Wealth
• Swiss Households Play IT Safe but Still Manage to Increase Their Net Financial Assets through Savings Growth
• The Financial Assets of Swiss Households Increased at A Slower Rate during 2007
• Swiss Household Balances Have Moved Away Heavily from Equities and Mutual Funds
• Swiss Households Show An Inclination toward More Safe Investments
• The Swiss Exchange Lost Less Value than Other European Exchanges in 2008
• Wealth Data in 2009
• The Swiss Hnw Investor
• Swiss Investors Are Cautious and Need Guidance from Their Wealth Managers
• Swiss Investors Are Most Likely to Have Cash Holdings as Their Financial Investment
• Wealth Management Service Implication: Clients Need Guidance to Take Advantage of The Market Recovery
• Innovative Global Example: Clientfirst Wealth Management in The US Provides Online Tools to Help Educate Its Clients
• Innovative Global Example: Btc Wealth Management Group Has Online Financial Planning Library Resource to Help Clients Learn about Investment
• over The next Two Years, Investors Will Cautiously Start to Return to Asset Classes Currently out of Favor
• Swiss Investors Are Looking to Equities, Corporate Bonds and Capital Protected Funds as The Economy Starts to Recover
• Wealth Management Service Implication: Offer Clients Innovative Capital Protected Products to See Them through The Economic Uncertainty
• Innovative Example: Ubs Launches Capital Protected Product to Satisfy Demand for Equity Products
• Innovative Example: Macquarie Has A Capital Protected Geared Equity Investment Product
• Swiss Hnws Demonstrate An Appetite for Risk but Are Demanding in Terms of The Standard of Wealth Management Service
• Hnws Exhibit An above Average Appetite for Risk but Are More Confused about The Impact of The Market Turmoil on Their Investment Portfolios
• Wealth Management Service Implication: Switzerland Should Aim to Lift The Bar and Educate Clients More about Investment Matters
• Innovative Example from Switzerland: Ubs Is Investing in Educating Its Clients
• Swiss Hnws Are Demanding in Terms of Standard of Wealth Management Service
• Wealth Management Service Implication: Wealth Managers Must Continue to Refine Client-Focused Operational Models
• Faced with Uncertainty, Swiss Hnws Want to Understand Their Investments
• Clients Are Clearly Seeking Guidance from Their Wealth Managers
• Swiss Investors Are More Likely to Be Looking to Asset Preservation than Profiting from The Downturn
• Hnw Clients in Switzerland Are Happy to Delegate Investment Responsibility to Their Wealth Manager
• Wealth Management Service Implication: Wealth Managers Need to Understand The Fundamental Attitudes of Their Clients
• The Swiss Wealth Manager's View
• in Two Years' Time, Hnws Will Still Need Some Guidance from Their Wealth Managers across A Range of Investments
• Several Fundamental Products and Services Will Be in Demand from Hnws in The next Two Years
• within An Overall Desire for Guidance from Their Wealth Management Service, Swiss Hnws Are Still Likely to Be Seeking Less Risky Products in Two Years' Time
• A Continued Demand for Capital Protected Funds and Bonds
• Innovative Example: Rbs Provides Capital Protected Investment Fund and A Higher Savings Rate to Its Customers
• Infrastructure Funds Are Set to Grow in Popularity in The Future
• Innovative Example: Ubs Launched An International Infrastructure Fund
• There Are Three Key Areas Where Wealth Managers Are Focusing Their Resources in Two Years' Time
• Wealth Management Service Implication: Understand The Fundamental Attitudes of Hnws in Order to Shape The Right Products and Services for Them but Encourage Them to Think beyond The Recession
• Innovative Example from The US: Morgan Stanley Creates A Global Infrastructure Fund to Take Advantage of The Current Market Conditions
• Wealth Managers Must Pay Attention to Brand, Image and Reputation, and Develop Personal Relationships with Clients as These Are The Key Drivers of Hnws' Choice of Wealth Management Service
• Wealth Managers Can Proactively Enhance Their Level of Personal Service to Help The Image of The Firm
• Wealth Managers in Switzerland See Personal Relationships as Their Biggest Strength and Service Quality as Their Biggest Weakness
• Swiss Wealth Managers Need to Convince Clients That The Company Is Financially Sound, and Give Them Several Points of Contact
• The Key to Increasing Share of Wallet Is to Assure Clients That The Company Is Financially Sound
• Wealth Managers Need to Give Clients Several Points of Contact within The Bank in Order to Be Successful at Retaining Hnw Clients
• Wealth Managers in Switzerland Are More Likely to Talk Their Clients Daily than Other European Wealth Managers, with Investors Mostly Wanting to Talk about The Performance of Their Portfolio
• Swiss Clients Are Being Contacted by Phone More Frequently than in Other Countries
• Swiss Wealth Managers Are Also Good at Getting in Front of Their Clients
• Overall Portfolio Performance Is Mostly What Swiss Hnws Want to Talk about When They Speak to Their Wealth Manager
  • APPENDIX
• Definitions
• The Drivers of Growth in The Wealthy Population
• Income Growth (Combined with Inflation, Changes in Gdp by Sector, Household Savings Rates and Debt Levels)
• Investment Returns (Market Capitalization, Interest Rates and Bond Yields)
• The following Measures Are Not, in Themselves, Drivers of Wealthy Population Growth
• Market Capitalization
• Gdp
• The following Measures Are Not Drivers of Wealthy Population Growth except under Very Restricted Circumstances
• Primary Residence Value Growth
• Inheritance
• Methodology
• Wealth Management Market Leaders Survey 2009
• Global Wealth Model
• The UK Sub Model
• Global Sub Model (for All Other Countries)
• Forecasting Methodology
• Continuous Refinement to The Understanding of Liquid Wealth Distribution
• Datamonitor's Wealth Numbers Compared with Other Wealth Numbers
• Definitions
• Western Europe
• References
• Further Reading
• Ask The Analyst
• Datamonitor Consulting
• Disclaimer
• List of Tables
  • Table 1: Wealth managers' views of UBS's wealth management services
  • Table 2: Wealth managers' views of UBS's wealth management services
  • Table 3: Wealth managers' views of UBS's wealth management services
  • Table 4: Wealth managers' views of strength and weaknesses of UBS's wealth management services
  • Table 5: Personal disposable income per adult in Europe, 2004-08 ($)
  • Table 6: Household savings rates as a percentage of disposable income, 2004-08
  • Table 7: Swiss household balances, 2007-08 (€m)
  • Table 8: Market capitalization of European and US stock exchanges, 2004-08
  • Table 9: What proportion of your HNWs' portfolios is allocated to the following five asset classes?
  • Table 10: HNWs' portfolio allocation now versus in two years' time
  • Table 11: HNWs' portfolio allocation by product area now versus in two years' time
  • Table 12: HNW attributes on a scale of 1 to 4 (1 = very low, 2 = somewhat low, 3 = somewhat high, 4 = very high)
  • Table 13: HNW attributes on a scale of 1 to 4 (1 = very low, 2 = somewhat low, 3 = somewhat high, 4 = very high)
  • Table 14: What are HNWs demanding today?
  • Table 15: in two years' time, how much demand do you expect from HNWs for the following product areas?
  • Table 16: What product areas will your wealth management service focus most resources on in the next two years?
  • Table 17: What will determine HNWs' choice of wealth management service over the next two years?
  • Table 18: What are your company's biggest strengths and weaknesses today?
  • Table 19: What is the most effective means of increasing share of wallet today?
  • Table 20: What is the best way to retain clients today?
  • Table 21: on average, how often do your relationship managers speak by phone to each HNW client?
  • Table 22: on average, how often do your relationship managers speak in person to each HNW client?
  • Table 23: When speaking with clients, what do they most want to talk about today?
• List of Figures
  • Figure 1: UBS's brand, image and reputation has suffered as a result of the turbulence
  • Figure 2: UBS is perceived as having a more limited product range but is stronger in its advisory service
  • Figure 3: UBS's wealth management operation is most let down by the quality of its relationship managers and their depth of relationships with clients
  • Figure 4: Switzerland consistently has one of the highest savings rates in Europe
  • Figure 5: Swiss household balances have moved heavily away from equities and mutual funds
  • Figure 6: The Swiss Exchange lost a lower percentage of its market capitalization than other European exchanges
  • Figure 7: The majority of HNW wealth in Switzerland is invested in the 'cash or near cash' asset category, with this accounting for 25% of all investments
  • Figure 8: over the next two years investors will move away from those assets currently more in favor
  • Figure 9: in 2011, the majority of high net worth assets in Switzerland will be invested in the 'Equities' category, with this accounting for 23% of all investments
  • Figure 10: HNW investors in Switzerland have a lower risk appetite than the average European HNW investor
  • Figure 11: There is a lower risk of HNW clients in Switzerland leaving to find another wealth manager than the average European HNW investor
  • Figure 12: in Switzerland, HNW investors' greatest demand is for simple, transparent investments
  • Figure 13: in two years' time, the greatest demand amongst HNW investors in Switzerland will be for infrastructure funds, with 23% of HNW investors demanding this category of product
  • Figure 14: Wealth managers in Switzerland will be focusing most of their resources on direct equity investment in two years' time
  • Figure 15: HNW investors in Switzerland are most influenced by brand, image and reputation in their choice of wealth manager
  • Figure 16: The greatest strength of wealth managers in Switzerland is their personal relationships with clients
  • Figure 17: The best way for wealth managers in Switzerland to increase share of wallet is to convince clients that the company is financially sound
  • Figure 18: The best way for wealth managers in Switzerland to retain HNW investors is to give the client several points of contact within the bank
  • Figure 19: in Switzerland, wealth management relationship managers speak to clients by phone approximately once a week
  • Figure 20: in Switzerland, wealth management relationship managers speak to to clients in person approximately once a quarter
  • Figure 21: The majority of clients in Switzerland want to speak to their wealth manager about the performance of their overall portfolio