Comment: Untapped millionaires in Europe’s postal banks
Various knowledgeable people in wealth management often point out the disparity between the absolute level of money managed by wealth managers and the amount of money held by high net individuals.
This is shown most vividly by the differences between the Scorpio Partnership annual private banking benchmark survey, which adds up most of the money managed by global wealth managers, and the Merrill Lynch/Cap Gemini Wealth Report, that gives the amount of money held by those with $500,000 and more in investable assets.
Normally the gap is somewhere around the couple of trillion dollars mark, with the rich having a lot more money than that managed by the global wealth managers.
Even allowing for any statistical disparities in the surveys, the gap highlights that many of the rich still have no relationship with a wealth manager, either because they are oblivious to their benefits, or believe their money is better managed by their existing banking relationship.
Some very rich people actively avoid wealth managers, with the most spectacular example of this being the alleged story about Mike Ashley depositing around £800m in his local retail bank shortly after his company, SportsDirect, listed on the London Stock Exchange.
Most of the wealthy aren’t looking at these types of sums, but many of them still opt to keep their money out of the hands of wealth managers.
A big proportion of this money – at least in Europe – ends up at postal banks, particularly in the region’s two biggest economies, Germany and France.
According to the French Postbank, more than 9,000 of its customers have €500,000, or more with the bank. That’s worth at least €4.5bn in assets under managed for Postbank.
Assuming a similar demographic and economic background of customers at Deutsche Postbank, the level is wealthy customer postal accounts are likely to be even higher in Germany.
The French Postbank has recognised the potential of these customers and set up a joint venture with local investment company Oddo called Banque Postale Gestion Privée to tap their potential.
A number of Europe’s big banks have their eye on buying, or merging with Deutsche Postbank – no doubt the bank’s wealthy customers would help to sweeten any deal.
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