Although UBS remains the leading provider, with an 8.75% increase in AUM in US dollar terms to $1,319 billion, two other firms have broken the $1 trillion mark: Citigroup Global Wealth Management reports a total AUM of $1,310 billion, and Merrill Lynch with $1,100 billion.
Overall, American firms dominate the rankings. Morgan Stanley in particular raced up the list for banks targeting clients with $1 million, becoming the number-two institution in that category (see table 2, below). Morgan Stanley jumped from fourteenth to fifth this year in the overall ranking.
But UBS remains the largest private bank, and the fastest-growing among the top 10, with AUM rising 25.3%.
ôThe market leaders are demonstrating a sustained concentration on efficiency and profitability,ö says Sebastian Dovey, managing partner at Scorpio. ôCritically, they appear to also be achieving a more global proposition that resonates with the rapidly growing first generation of new wealth holders.ö
The data also show that, while firms such as UBS, JPMorgan and Citigroup have based their wealth-management businesses on the ultra-high net worth segment (for minimum investments of $10 million), it is the more modest end private banking that provides the most business.
ôTargeting the ultra-NHW is often cited as the ultimate goal of many private banks,ö says Cath Tillotson, partner at Scorpio. ôHowever, the research is now clearly demonstrating that it is often more profitable for banks to attack the mainstream private client market. There are more opportunities and the solutions can be more efficiently sold.ö
She adds that both the growth and the profitability in the ultra-HNW sector is lower than in services for clients making investments in the $1-10 million range.
UBS won FinanceAsia's Best Private Bank award last year.