Vontobel, a Swiss private bank, is expanding its business to serve the mass affluent. The move is a diversion from its tradition of solely serving the region's wealthy.
Vontobel is setting up a unit for less wealthy clients – a segment generally defined as those with less than $1 million to bank – due to changes in population structure and consumer behavior, a source told finews.asia. The push comes amid a new digital hub being built in Zurich that can target high net worth clients as well as mass affluent.
The private banking arm, led by Georg Schubiger, is tiny but profitable in Asia – thanks in large part to a lean structure which books the region's assets in Zurich, not Hong Kong or Singapore.
Responding to Digital Needs
The digital hub is a response to emergence of the «silver generation», «millennials», and «digital natives» – less wealthy but potentially lucrative business for Vontobel. The bank plans to tap efficiencies through digitization and its digital offerings, the person said.
«Vontobel has to prepare itself to serve these younger generation clients,» Schubiger was quoted as saying in an online Hong Kong finance publication. «They will be much more digital on the go and demand services at anytime and anywhere.»
«To do this, we must offer them the appropriate services. If we don’t have such an offering, we will lose them to competitors,» he added.
Retaining the Human Touch
Although private banks are shifting towards digital onboarding of clients and digital portfolio management, retaining human advisers is essential to the bank. Vontobel's private bank boss in Asia, Alex Fung, is looking to hire experienced bankers, he told finews.asia-TV last month.
«Future generations also want to talk to one person and not only with a machine,» Schubiger said. «In most cases, a person would like to discuss his ideas with a person at some point and get confirmation that he is right.»
