Global Private Banking Awards 2015: Winners’ Profiles – National Winners (Central and Eastern Europe)

Best Private Bank in Georgia

TBC Bank Private Banking

TBC Bank has one of the oldest private banking lines on the Georgian market, servicing around 8,000 clients. One of its strengths is an  “omni-channel banking platform that suits contemporary customers”. Seventy-five per cent of its affluent clients and 100 per cent of UHNW and HNW clients use its remote banking channels for their operations, leaving client-facing staff to focus on bespoke advice for clients.

 “TBC is distinguished by its advanced multichannel capabilities,” says CEO Vakhtang Butskhrikidze. “Our objective is to move to the new, digital era of banking in Georgia. Our best-in class customer relationship management captures the preferences and choices of our private banking clients, allowing us to offer the most complete, focused and modern private banking experience.”

Over the year, TBC also expanded into the mass affluent market, delivering AuM growth of 19 per cent and an increase in net new money of 42 per cent. CJ

Best Private Bank in Hungary

OTP Private Banking

OTP Private Banking, part of OTP Bank, is present in nine countries across the CEE region, managing €4.2bn in client assets, but Hungary is by far the dominant market, making up 73 per cent of AuM.

Both AuM and client numbers saw impressive increases in 2014 as the bank took advantage of its retail banking operations to acquire private banking clients, but there was also a big push to increase the number of clients coming from external sources. Partnerships with prestigious brands and art galleries helped to boost the bank’s brand while new advisers were also hired, both helping to boost the numbers of new clients sourced from external sources by 70 per cent.

Despite this, OTP and private banking in the region face considerable challenges in the future, says managing director András Takács. “Ultra low interest rates are a particularly big challenge in the CEE region, because the investment culture and attitude still differ from Western European standards and money market and fixed income investments are more dominant in client portfolios,” he explains.

Client portfolios have been restructured to include more sophisticated investment products, generating a “win-win” situation as customers were rewarded with higher yielding options while these products offer the bank higher profit margins. “The move toward more complex investment solutions means a change in the risk mindset of the clientele, of course,” says Mr Takács. “Therefore it is crucial to implement methods ensuring compliance with the risk capacity of the clientele. We put emphasis on this factor.”

These changes in investment attitude and clients’ needs require increased developments on the IT side however, as well as to business models. “To meet these challenges it requires a lot of operational and capital expenditure,” he says. “In the future we have to focus on increasing efficiency and managing service costs through the model as well as enhancing the digital channels.” ES

Best Private Bank in the Czech Republic      

ČSOB Private Banking

Despite being active in the Czech private banking market for the past 12 years and posting respectable figures – client assets have surged to $4.1bn (€3.6bn), up 10 per cent during 2014, including $300m of new money – ČSOB has reflected on a distinct absence of strategically developed, tailor-made services for ultra wealth clients.

In order to address this, the bank has launched a Wealth Office, staffed by private bankers, specialising in cross-generational and succession planning services, real estate advisory, private placements and financing solutions.

The planned switch for these clients to fee-based advice may not move so smoothly, fears Pavel Tichý, Wealth Office director at ČSOB. “Once you show the bill to clients for the advice you have given them, that’s the signal for negotiations to start.”

One of the reasons ČSOB launched the new capacity was down to the high numbers of Čzech businesses currently being sold.

“All the entrepreneurs are selling their companies because they are aged 60 to 65 and it is difficult for them to find successors,” confides Mr Tichý. “It is a good opportunity for us to make some transactions and to keep managing their money, creating a better structure for their wealth.”

In tandem with this development, a busy year has seen ČSOB open up its architecture to a small selection of big-brand third party funds. Fidelity, Aberdeen and Templeton were easy groups to choose, as they are already “entrenched in the Czech market,” he says, but more names of external product providers are in the pipeline, with the bank working with parent institution KBC Private Banking in order to locate more players.

But persuading clients to switch from bonds, which they perceive to be a conservative play, to equities, is not so easy. “They burned their fingers during the Russian crisis, again when the dotcom bubble burst and once more in 2008,” says Mr Tichý. “Our clients’ experience with equities has not been so positive. There is always a two to three year period when they made profits, but then next year, it was gone.”

This means most of his clients have a “sub-optimal” 30 per cent underweight allocation to equities. “It is a difficult discussion to convince them of the value which we see in equities,” he says.   YB

Best Private Bank in Slovakia

Tatra Banka

In 2014, Tatra Banka says it maintained the largest share of the market in Slovakia and lauched several new services to its private clients. It also created an acquisition team and took on more than 100 new clients with new NAV of €74m but decreased the number of clients at the lower level of its service.

“Every year we introduce a number of innovative solutions with the aim to simplify client communication with the bank, make the management of financial assets more convenient, speed-up entering orders for sale and purchase of securities and to ensure convenient transfers between accounts,” says Katarína Boledovičová, director of the private banking division of Tatra Banka.

During the year, the bank introduced the MobileSignTB app enabling clients to make transactions, including payments, through their mobile phone.

“In the service area we have been working on automation of the subsequent internal processes in terms of our MobileSignTB application which will provide our clients with even more comfortable and secure execution of transactions,” adds Ms Boledovičová. “An upgrade of portfolio reporting will be another big challenge for us because we want to come up with several new views on clients’ assets.”

At the beginning of 2015 the bank also finished a major project on stress testing  customers’ portfolios. This allowed the bank to see how client portfolios would perform under different scenarios and to verify their risk profiles.

“We are the only private bank to come up with a unique innovation – portfolio stress-tests – this year, at a time of stockmarket peaks,” believes Ms Boledovičová. “This is why we were able to prepare our clients for the fall that came in August.” CJ

Best Private Bank in Poland

Bank Pekao S.A. Private Banking

Pekao Private Banking, established in 1997, claims to be a pioneer in private banking in the Polish market.

Over the last 18 years the market has changed considerably, but the bank has remained focused on customer satisfaction, and expanding its offering for the wealthiest segment of clients.

For example, it now offers a currency exchange service in PekaoInternet for customers with existing Pekao24 accounts, with preferential rates. Clients can also use the new Pekao World Elite MasterCard, which offers multi-currency functionality.

The scope of customer relations has been enhanced to support enterprises run by private banking clients, and any company run by a client has access to a wide range of investment products offered by Bank Pekao and its affiliated brokerage house Centralny Dom Maklerski Pekao SA.

Over the year, Pekao Private Banking’s total financial assets grew by 6 per cent with mutual fund volumes up 15.5 per cent  year on year, compared with average market growth of  13.4 per cent.

Adam Niewinski, head of the private banking division, says its mission is to deliver highly individualised financial solutions for private banking clients and offering an integrated and complex service model.

“We have shown our capability to implement innovative solutions for our clients and to provide best answers in a continuously changing and demanding economic situation,” he adds. CJ

Best Private Bank in Russia
Credit Suisse

Credit Suisse’s client-facing technology initiative is a perfect example of how private banks, in order to remain competitive, are having to transform their service models. The bank says it has empowered clients with round-the-clock access to account information, market insights, and intelligence personalised to their portfolios, while giving them the ability to trade. 

In early 2015, the global bank launched its digital private banking platform first in Asia Pacific, its largest private banking business outside Switzerland, followed by the introduction of a private banking app in its home market. 

This was the first step of a multi-year global rollout, which will cover the US and Europe from late 2016.

“For us it is important to create a consistent user experience across all regions, hence our architectural thrust to create a digital platform that can be adopted across different booking centres around the globe,” says Marco Abele, managing director and head of Digital Private Banking.

Having launched an app to help relationship managers give better advice in client meetings, the bank is planning to create a new dedicated “RM Ecosystem” based on the new digital platform, aimed at connecting daily activities, improving productivity and providing advisers with timely information to deepen client engagement. 

Change management, talent transformation and client awareness are key factors for a successful digital transformation, says Mr Abele.

“We can build the most beautiful application, but if it is not used it is worthless,” he states. “A transformation effort means a behavioural change of all participants.” To facilitate that change, it is important to involve the participants early in the design process, he says. 

“Impatience is the biggest challenge. Digital transformation is a marathon, not a sprint,” warns Mr Abele. 

The bank also won awards for best private bank in Russia and in the Middle East, for the third and second year running, respectively. 

In the Middle East, the bank was able for the first time to provide lending and custody against local GCC (Gulf Cooperation Council) shares to clients. 

“This key differentiating capability is important for our growth and is enabled by our integrated bank approach, combining private banking, investment banking and asset management capabilities,” says Bruno Daher, Mena CEO. UHNW clients are of strategic importance to the Middle East region and account for most of the bank’s business. 

“With an appetite for global solutions, and an affinity for emerging markets, they are a sophisticated client and the key decision makers in financial institutions, public sector and corporates.” Despite the geopolitical situation and resulting economic turbulence having a significant impact on clients and their businesses, the bank still foresees a high degree of opportunity and growth for the region. “The key to managing challenges is to remain close to clients,” he says.

In Russia, where the bank claims an  onshore footprint since the opening of its Moscow office in 1993, wealth is gradually becoming more global. “UHNWIs are increasingly investing both directly and indirectly into international companies and markets,” observes Dmitri Kushaev, Credit Suisse CEO Private Banking Russia. “Our relationship managers and specialists are locally and culturally anchored in Russia and understand the needs and requirements of Russian clients.” 

Entrepreneurs, mainly in the first generation of wealth, are a key client segment for the bank and particularly benefit from Credit Suisse’s “one bank” model and “dedicated investment offering”.  ET