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The corona crisis is a jolt to the wealth management industry. For more innovative private banks, the pandemic represents a historic opportunity. Eight scenarios.

The prospects for Swiss private banks – which cater to the financial affairs of wealthy clientele – were dire before the coronavirus pandemic hit. Sandwiched between big universal banks and a growing chorus of promising start-ups, they are finding it nigh impossible to win new clients and to keep up with necessary investments and new offerings.

The outbreak of COVID-19 or coronavirus will only step up the inevitable transformation in the private banking industry – and leave a few which lose out behind: given collapsing margins and growing costs, this crisis is likely to wipe out a few private banks.

But those prepared to genuinely break with past patterns and use the hour of crisis constructively may belong to the virus crisis winners. finews.com on what wealth managers can learn from the pandemic.

1. Home Office is a Thing

We're still just getting to know this new work environment, but it's already clear that «WFH» or working from home is here to stay: it is efficient, cheaper, and more flexibly structured. Getting employees with the discipline to work remotely is only a question of time – and mastering it will be a valuable future skill. Conversely, private banks will need to integrate this type of work into their business model if they want to retain top talent.

2. Totally Digital

Corona has already proven it: digital contact with clients is a reality – inevitably. Countless clients have dusted off or upgraded their digital banking tools since they can no longer see their private banker face-to-face. Even when the crisis passes, digital interaction is here to stay – it's practical, efficient, and inexpensive. Private banks that can't handle that will disappear. 

3. Data is the Key

Private banks have collected their client data somewhat haphazardly in the past. Part of this was due to banking secrecy when many clients wanted the opposite of transparency. That era is definitely over: banks that want to address their clients in a more focused and targeted way thanks to artificial intelligence need data specialists to mine this 21st-century gold. Banks who haven't recognized the power of data will languish after the crisis.