Communication between HNWI and private bankers in the time of coronavirus

We Wealth | May 2020

How has the communication between HNWI clients and bankers changed in the time of lockdown? Let’s start with two emblematic cases, the product of ethnographic observations confirmed by the results of a quantitative analysis carried out by FINER.

First case: an 85-year-old entrepreneur from Padua and his banker, a brilliant 40-year-old man working in an important private bank in Milan; before the lockdown, the banker used to travel 600 km by car/train every week to meet his client and share his investments decisions and results.

Then, the lockdown: the client is housebound in Padua, the banker in Milan; and yet, the banker does not lose heart and successfully persuades his client to try video conferencing.

The lively 85-year-old soon learns to appreciate video calls, enough to request for one video call a day instead of one every week.

It is a win-win situation: the client is provided with precise and updated information; the banker saves time (5 hours per week, instead of the usual 12-hour trip to Padua) and money (travel expenses) he can now spend with other clients or with the same client, thus enhancing the quality of service.

The second case takes place in Geneva. An extremely wealthy 82-year-old art collector is sitting on her sofa, on the walls are paintings by Burri, Fontana, Picasso. She is on a Houseparty call with friends and relatives from all over the world. Her phone rings: it is her banker. “I can’t talk now,” she tells him, “let’s meet on Zoom in an hour”.

What do the two examples have in common? First of all, both protagonists are HNWI clients – as such, they belong to the most demanding, hard-to-satisfy segment of clients, capable, if well assisted, to jumpstart the career of a good private banker.

Both protagonists are over eighty years old and have nearly no digital culture. Until a few weeks ago, they used video calling services to chat with their children and grandchildren. However, they had never contemplated using them to contact their banker.

Circumstances and the absence of alternatives forced a change in the means of communication between clients and banks, a change effectively implemented during the emergency.

This finds empirical confirmation in an ongoing study conducted by FINER, set to last from 9 March to the end of the year. One of its goals is to better understand the way in which communication between banks and clients has changed after the lockdown.

The results of the first collection of data are quite surprising: first of all, the frequency of communication between HNWI clients and private bankers per week has doubled, increasing from 37% on 9 March (beginning of the lockdown) to 75% on 19 April.

Moreover, the content of the communications appears to have changed as well. In March, communications focused on two main aspects: information on financial position (47%) and on the medical emergency (37%). In April, however, information on financial position (76%) takes precedence over information on the medical emergency (12%).

Moreover, in only four weeks, the means of communication have rapidly changed – from phone (54% in the week of 9 March) and emails (42%) to video calling (46%).

The level of satisfaction with content and means of communication has increased from 49% to 57% in four weeks.

There is no doubt over the exceptionality of the current circumstances. However, the level of adaptability shown by the most demanding and less digitalized segment of clients, the HNWI, is equally exceptional. They made a virtue out of necessity.

At the same time, the willingness of banks and bankers to adopt digital tools (certainly already available, yet little used so far) is just as praiseworthy.

The field of asset management has always built its success on the right mix of relational dynamics and expertise. Therefore, it is possible to foresee a gradual return to old habits and relations.

However, there is no doubt that the lockdown triggered an irreversible change – it forced clients, financial professionals and banks out of their comfort zone, fostering new means of communication and recruitment.

Our newly acquired habits will probably topple the remaining competitive advantages, thus redrawing the competitive picture proper to the industry of wealth management: only the very best are going to win, only those who can navigate a stormy sea.

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