Scope
Sizing and forecasting of mass affluent and high net worth individuals were generated from Datamonitor's proprietary Global Wealth Model
Data presented for 10 liquid asset bands, from EUR50-75K to EUR3m+
24 Italian wealth managers were surveyed during Datamonitor's Wealth Management Market Leaders Survey 2005
Survey questions covered business and product/service development, client trends and attitudes and general market issues
Highlights
In 2004 wealthy clients accounted for 9.8 per cent of Italy's total adult population, equivalent to 5.7 million individuals. Within this, 1.0 per cent were classified as high net worth individuals, while the remaining 8.8 per cent fell within the mass affluent category.
The greatest opportunities for revenue growth in the Italian wealth management market are expected to lie in the acquisition of new clients, strengthening of product range and integration of mergers/acquisitions, with almost a half of surveyed wealth managers selecting these options.
Many industry observers agree that ABN Amro's acquisition of Banca Antonveneta could prompt further consolidation among Italy's numerous smaller banking players. Moreover, many banks may also be pushed to make acquisitions to protect themselves from unwanted takeover attempts.
Reasons to Purchase
Assess market attractiveness by reviewing size and growth forecasts up to 2009
Improve client service through greater awareness of their attitudes and concerns
Assess the threats and opportunities for wealth managers in the market |
CHAPTER 1 EXECUTIVE SUMMARY
Italian mass affluents and high net worths
Competitive background
Opportunities and threats for wealth managers
Clients
Future market developments
CHAPTER 2 INTRODUCTION
What is this report about?
Who is the target reader?
How to use this report
Note to readers
CHAPTER 3 ITALIAN MASS AFFLUENTS AND HIGH NET WORTHS
Italian HNW individuals have emerged from the recent equity downturn in much better health than their mass affluent compatriots
Italian mass affluents and the assets they hold grew by 2.7 and 3.3 per cent since 2000
Italian High Net Worths and the assets they hold grew by 18.1 and 20.7 per cent respectively since 2000
Italian mass affluent account for 8.8 per cent of the total population
Mass affluent individuals hold EUR539 billion in liquid assets
Italian HNW represent just one per cent of the country’s adult population
HNW individuals hold EUR452 billion in onshore liquid assets
Data tables
CHAPTER 4 COMPETITIVE BACKGROUND
The Italian wealth management market is underdeveloped compared to its European neighbors
The competitive make-up of the Italian wealth management market has undergone significant changes in 2004/2005
Italy was home to the two most significant European M&A deals in 2005
A number of overseas players have enhanced their presence in the Italian market
A few domestic players also completed a number of strategic acquisitions
Alternative investment products are set to become more popular in Italy following the new legislation
CHAPTER 5 OPPORTUNITIES AND THREATS FOR WEALTH MANAGERS IN ITALY
Mergers and acquisitions, new clients and stronger product range are the best sources for revenue growth in the next two years
Staff recruitment and improving support systems are two key initiatives for Italian wealth managers over the next year
Staffing and domestic competition are major issues for Italian wealth managers
Compliance will cause the greatest concern for cost base management
Data tables
CHAPTER 6 WEALTHY CLIENTS
A personal relationship and reputation are the main factors in determining a client’s choice of wealth management service
Italian wealthy clients rate service ahead of investment performance and advisory capability
Referrals from existing clients remain most effective for client acquisition
Italian wealthy clients tend to have relatively long-term relationships with their wealth managers, but are more prepared to defect than five years ago
Over 80 per cent of wealth managers in Italy have an average client relationship of more than five years
Italian clients are significantly more likely to change their wealth manager now than five years ago
Italian clients are demanding more contact and more knowledge about their investments
Retaining clients is now highly dependent on adequate investment performance
Wealth preservation is the key for Italian wealthy clients
Professionals and business owners offer the greatest potential for future business
Italian wealth managers control a relatively small proportion of their clients’ wealth
Over a half of surveyed Italian wealth managers tend to abide by thresholds
Data tables
CHAPTER 7 FUTURE MARKET DEVELOPMENTS
Foreign exchange and general insurance products are seen to hold significant business potential among wealthy Italians over the next two years
Alternative investments, on the other hand, are seen as having very little potential over the next two years
Despite being seen as having little business potential, alternative investments are at the top of the list when it comes to developing investment offering
Larger banks and niche wealth managers are expected to increase their market share over the next two years
Wealthy Italians and their assets are forecast to increase strongly over the next five years
Combined value of Italian mass affluent and HNW assets is forecast to reach EUR1,245bn in 2009
Combined number of Italian mass affluent and HNW individuals is forecast to reach 6.8m in 2009
Data tables
Forecast tables
CHAPTER 8 APPENDIX
Methodology
Survey methodology
Definitions
Global Wealth Model Methodology
Further Reading
Datamonitor Global Wealth Service SPP: Reports
Datamonitor Global Wealth Service SPP: Insight Reports
Datamonitor Wealth Management Competitor Tracker
Datamonitor Asia Pacific Wealth Management SPP: Reports
Datamonitor Savings & Investments SPP: Reports & Briefs
Datamonitor Savings, Investments and Protection SPP: Interactive Models
SPP writing team
LIST OF TABLES
Table 1: Europe: the number of mass affluent and HNW individuals and the value of their liquid assets, 2000-2004
Table 2: Italy: Number of mass affluent individuals, segmented by liquid asset band, 2000-2004
Table 3: Italy: Value of mass affluent liquid wealth, segmented by liquid asset band, 2000-2004
Table 4: Italy: Number of HNW individuals, segmented by liquid asset band, 2000-2004
Table 5: Italy: Number of HNW individuals, segmented by liquid asset band, 2000-2004
Table 6: What will most determine revenue growth in the Italian market in the next two years?
Table 7: What strategic initiatives are you considering or implementing in the next year?
Table 8: What are the most pressing concerns for your business at present?
Table 9: What are you main areas of concern in controlling your cost base?
Table 10: In your experience, what are the key influences that determine an Italian client’s choice of wealth management service?
Table 11: In your experience, what are the most effective customer acquisition techniques in the Italian market?
Table 12: How long has your client base, on average, been with you?
Table 13: To what extent do you agree with the following statements?
Table 14: In your experience, what are the most likely reasons for clients to leave a wealth management service?
Table 15: What are your clients most interested in today?
Table 16: Which client types offer the greatest potential in the next five years?
Table 17: Approximately what share of your clients’ wallet do you think you have on average?
Table 18: In relation to thresholds, approximately what proportion of your client base is currently below it?
Table 19: On average, what proportion of your clients would you estimate have their primary wealth management relationship with you?
Table 20: Forecasted macro-economic variables, 2004-2009
Table 21: Please rate the following product areas in terms of their business potential among wealthy clients in your market during the next two years?
Table 22: From the following product areas, o nwhich three will your company be focusing most resources in the next two years?
Table 23: How are you planning to develop your investment offering in the next two years?
Table 24: To what extend to you agree with the following statements?
Table 25: Italian mass affluent forecasts
Table 26: Italian high net worth forecasts
LIST OF FIGURES
Figure 1: 8.8% of those aged 18 in Italy as mass affluent individuals 3
Figure 2: 54 per cent of Italian wealth managers believe professionals will be a key client group for the next five years 5
Figure 3: Italy is far ahead of the European average in terms of the number of mass affluent and the value of their liquid assets, 2000-2004
Figure 4: Italy also outperforms Europe where the growth of the HNW individuals and their liquid assets is concerned, 2000-2004
Figure 5: The number of Italian mass affluent individuals has been increasing steadily since 2002, 2000-2004
Figure 6: Italian mass affluent liquid assets have also experienced strong growth since 2002, 2000-2004
Figure 7: The majority of Italian HNW individuals fall into the lowest asset band, 2000-2004
Figure 8: Italian HNW in the lowest and the highest asset brackets hold more wealth than other HNW, 2000-2004
Figure 9: New clients, stronger product range and mergers and acquisitions are the key sources for revenue growth in the Italian wealth management market over the next two years
Figure 10: Over 60 per cent of wealth managers are considering significant staff recruitment program during the next years
Figure 11: Increased competition from domestic players and attracting quality staff are the main concerns for Italian wealth managers
Figure 12: 79 per cent of Italian wealth managers consider compliance costs to be a key concern for controlling their cost base
Figure 13: A personal relationship and branding, image and reputation are seen as key influences in a client’s choice of wealth manager
Figure 14: Almost 90 per cent of Italian wealth managers consider client referrals to be one of the most effective customer acquisition techniques
Figure 15: For over 80% of Italian wealth manager, their average client base has been with them for more than five years
Figure 16: Almost 80 per cent of Italian wealth managers believe that clients are more likely to change their wealth manager otday than five years ago
Figure 17: The overwhelming majority of respondents stated that clients are demanding more contact with their wealth managers and wish to know more about the management of their funds
Figure 18: Over 60 per cent of Italian wealth managers believe that inadequate investment performance is one of the most likely reasons for clients to leave a wealth management service
Figure 19: Protecting their current asset base is one of the key interests for Italian clients at present
Figure 20: 54 per cent of Italian wealth managers believe professionals will be a key client group for the next five years
Figure 21: Nearly 40 per cent of Italian wealth managers believe they control over a half of their clients’ assets
Figure 22: 56 per cent of Italian wealth managers have the majority of their client bases above the threshold levels
Figure 23: Foreign exchange products are seen as those with the most potential for Italian wealthy clients over the next two years
Figure 24: Almost a half of Italian wealth managers believe that alternative investments will offer no potential in the next two years
Figure 25: Over 60 per cent of wealth managers in Italy will be extending their alternative investment coverage over the next two years
Figure 26: Niche wealth managers are widely expected to play a greater role in the Italian wealth management market in the next two years
Figure 27: Liquid assets owned by mass affluent and HNW Italians is forecast to grow by an average of 5.1 per cent each year to 2009
Figure 28: The number of mass affluent and HWN Italians is forecast to grow by an average of 4.1 per cent each year to 2009
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