Private banking, specializing in the management of large estates, faces limited growth possibilities in Spain. It can only continue to gain scale through mergers or through the transfer policy.
Financial sources consulted by Europa Press explain that the sector can only share 30% of the business, as the remaining 70% is almost entirely comprised of the five major banks (Santander, BBVA, CaixaBank, Bankia, and Sabadell).
The high atomization among the entities
Added to this is the high atomization among the entities that form part of the smallest percentage distributed of the business. Which, among stockbrokers, banks, managers or Eafis (Financial Advisory Companies), add up to more than four hundred firms.
The lack of savings and investment culture among Spaniards, as well as the context of interest rates at historic lows, are other components that lower the expectations of growth possibilities in the sector.
“There’s no one who gets a scale to win. If you suddenly get a fine or a crash, you’re shivering,” said the same sources. In this context, private banks have only two options. To take an active part in the consolidation processes or to continue with the growth policy by means of transfers.
Private banking, like the big players in the sector or even insurance companies, is leading the second wave of consolidation.
The Portuguese bank, Novo Banco, now in the hands of the Lone Star fund. It maintains an open sales process for its manager. Tressis, Gala Capital and Santalucía are the three candidates to take over this business. Although, sources in the sector see the insurance company as the clear winner.
The securities company Tressis is a firm with an obvious buyer role. But so are SelfBank or Andbank España. In fact, this last entity valued taking over Novo Banco’s management company due to its interest in growing via corporate operations.
However, the Portuguese entity refused to sign a preferential marketing agreement with the sale. Moreover, rejected the offers of the financial institutions, so Andbank España did not participate in the bid.
Robbing bankers as a strategy
Another policy these firms are adopting is that of signing up competing bankers. The idea is to find a person with 15 or 20 years of experience. Who is loyal to a brand and has a good reputation, but, above all, who has an attractive client portfolio.
Bankers’ ‘theft’ is a very widespread practice in the sector. Therefore, institutions try to take care of their own with interesting salaries and benefits.
A little over a month and a half ago Alantra Wealth Management signed Antxón Elósegui, from Indosuez Wealth Management España, as its new partner. Elósegui took the whole team and the clients he was advising to Alantra, movement that has left in Indosuez an important hole.
Deutsche Bank division
Deutsche Bank’s Large Wealth Management division took some twenty-five bankers from competitors in the last year and a half, such as Abante, Bankinter or Santander.
And bank España was quite active this year in this strategy, having signed almost fifteen bankers from Banca March, Novo Banco or Caixa Geral. Now it would be testing new profiles in order to be able to open two new branches.
(Featured image by Etienne Martin)
First published in invertia, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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