Private wealth management has been undergoing a massive transformation. In large part, because of the rapid technological innovation that has been going for the past couple of years, but more significantly, as a result of the strict measures being implemented by various governments to combat the pandemic. In this insightful interview with Masroor Batin, CEO Wealth Management – Middle-East & Africa (MEA) at BNP Paribas Wealth Management, he spoke about the new landscape in private wealth management, the trends in inter-generational wealth transfer and the role of digital in investments and meeting client expectations.
Global Private Banker: How was 2020 as a year for BNP Paribas Wealth Management across MEA, and what are you hopeful for over 2021?
Masroor Batin: We will all remember 2020 as the year of Covid-19. The different waves of the pandemic and lockdowns resulted in the fastest and deepest recession on record. At BNP Paribas Wealth Management MEA, we adapted our platform in just a few days to allow remote working while continuing to serve our clients. We also enhanced our digital capabilities to better engage with our clients since we were no longer able to meet them in person. It was firm proof of our agility to adapt.
Apart from the pandemic, by all metrics, 2020 was a very strong year for BNP Paribas Wealth Management MEA. We grew our teams notably on the coverage side; we enhanced our new client-centric commercial organisation; our clients entrusted us with significant net new cash (+$1Bn vs. 2019) and we closed remarkable transactions. More importantly, we focused on being even closer to our clients so we could serve them even better during this turbulent time. Our recent awards including “Best Private Bank in the UAE” given by your magazine, as well as our client satisfaction surveys, are a strong testament to our commitment that drives us every day as a company.
In 2021, we will continue our efforts in this regard, and we will ensure that we closely accompany our clients in their investment decisions and in their ambitions. We are also cognisant of the global challenges we are facing such as transitioning towards a sustainable economy. Today BNP Paribas Wealth Management is a recognised leader in the field of sustainable investment solutions, and we aim to continue meeting this growing demand from our clients for responsible solutions.
Many experts predict that around $30Tr to $70Tr will be passed down from the Baby Boomer generation to the millennial market in the coming decades, calling this the “Great Wealth Transfer.”
Global Private Banker: How is your firm approaching generational wealth transfer to the millennial market?
Masroor Batin: Many experts predict that around $30Tr to $70Tr will be passed down from the Baby Boomer generation to the millennial market in the coming decades, calling this the “Great Wealth Transfer.” This is very likely to be the largest wealth transfer in history. Within the Middle East, most of our clients are preparing for this transfer and we are already accompanying them with our award-winning Wealth Planning team. Within BNP Paribas Wealth Management, we also organise Next Generation Seminars, dedicated to children of UHNWIs, which educate this generation on all aspects of this wealth transfer including the necessity for long-term strategic planning.
Finally, we clearly see a great acceleration in the uptake of socially responsible investing across all demographics, and notably among millennials. According to our 2020 BNP Paribas Global Entrepreneur report, 70% of entrepreneurs globally are more willing to invest sustainably than 2 years ago. Millennial entrepreneurs have even stronger ambitions: they are willing to invest as much as a fifth of their investments responsibly by 2021. We have integrated sustainable criteria into our core offering and we will take into consideration our clients’ risk/return and sustainability profile when we propose the investment solutions that match their values and their ambitions.
Global Private Banker: What is your outlook on the impact of COVID-19 on the private wealth landscape over the next 12-24 months, and what critical measures has your business taken to navigate these waters?
Masroor Batin: First, our clients are asking for more advice. In a rapidly changing environment, which is by its nature unpredictable, providing our clients with regular (sometimes daily) market updates and with easy access to market experts, becomes essential. We believe that banks with strong global and local expertise and tailor-made capabilities will have a strong competitive edge in this context, which is most certainly the case for BNP Paribas. For example, we published our 2021 Investment themes, they are grouped by investment horizon, from short term to long term but also looking at key areas such as sustainability, and we believe that these themes will be key for driving our clients’ investment ambitions.
Second, clients are looking for diversification, both in their investments and for their wealth managers and they now favour international players with strong solvability and liquidity ratios. This is clearly a driver at BNP Paribas! Again, we have seen an increased interest in our firm due to its size, its diversified model and its solidity.
Finally, the digital journey has accelerated both internally and externally, and we have launched new ways of engaging with our clients and our teams.
I strongly believe the measures, which we have put in place during these exceptional circumstances, like today, won’t go away when the crisis ends. They will become our BAU.
Global Private Banker: What are some of the digital capabilities your firm is investing in, as a result of changing client expectations?
Masroor Batin: There is nothing new that clients expect innovation from their wealth manager, and we have been investing in our digital capabilities for many years. It is probably too early to say definitively how the past few months events will shift client expectations, but we believe that there will be a significant transformation, putting on banks a responsibility to accelerate the digitalisation of the client experience.
For example, while physical interactions have always been central in our relationships with our clients, clients are much more open to digital interactions with us. This is definitely the result of the months of lockdown situations and travel restrictions.
To answer these new expectations, we continue to enhance our client journeys, notably in the areas of advice, portfolio management and communication. We have been leveraging during the last years on digital to make the client experience smoother and more personalised.
We believe that banks with strong global and local expertise and tailor-made capabilities will have a strong competitive edge in this context, which is most certainly the case for BNP Paribas.
Global Private Banker: Which Wealth Management FinTechs have caught your eye of late?
Masroor Batin: Globally, we have partnered with top FinTechs in their respective fields of expertise, notably through our digital factories in Europe and Asia. Recently, we partnered with Gambit, a Belgium FinTech active in robo-advisory technology, to build a digital investment mandate for some of our clients. To give you another example, we are also currently working with DreamQuark, a deep learning platform, which has been accelerated in our BNP Paribas Plug & Play accelerator program in Station F in Paris.
Global Private Banker: How does BNP Paribas Wealth Management in the Middle East differentiate in a highly competitive landscape, and what would you say is your unique value proposition?
Masroor Batin: Without any doubt, it is our One Bank integrated approach, which is at the heart of our value proposition. It allows our Wealth Management clients to benefit from the not only our expertise, but also from all the expertise within the BNP Paribas Group, which is truly unique in the banking industry. For example, our clients can benefit from our Real Estate business, Asset Management, Personal Investors, Securities Services, Islamic Finance and Insurance to name a few. And of course, there is our very unique international footprint.
We are “the bank for a changing world” and to be so, we must understand the world, its changes, opportunities and challenges. This is our uniqueness.
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