Wealth Management in Italy 2011

Introduction

Clients lost a lot in the recession: returns, risk tolerance and confidence. Now in a rebuilding phase, wealth managers that understand their clients' demands and motivations are in the best position to profit. Datamonitor's analysis provides the data and insight to monitor competitors' strategies, size their potential customer base, and understand their needs.

Features and benefits

* Build your customer targeting strategy using in-depth HNW demographics and needs analysis based on Datamonitor's annual Global Wealth Manager Survey.
* Assess your competition through detailed profiles of notable players, including the customer targeting, marketing and product strategies they employ.
* Size your potential client base using Datamonitor's proprietary data, presenting the number of affluent individuals by liquid asset band to 2014.

Highlights

The tax amnesty, in 2009-201 was extremely successful and over €100 billion undeclared assets were brought back onshore, coming mostly from Switzerland. Many foreign wealth managers have expanded their operations in Italy in order to take advantage of the massive inflow of capital and to maintain relationships with pre-existing clients.
There are a few crucial gaps in the service offering of wealth managers in Italy such as the lack of tax or inheritance planning. It is crucial that wealth managers built a stronger offering in the field and build an in-house tax expertise to strengthen their relationships with clients
The Italian wealth management market is dominated by large universal banks. Unicredit and Intesa Sanpaolo are by far the two largest groups with about €70bn in AUM each.

Your key questions answered

* What strategies are my competition employing to win and keep affluent clients?
* Which products and services will affluent clients in Italy want in the next two years?
* How is the Italian wealth management structured? What role do banks and asset managers play?
* How many potential clients in Italy have onshore liquid assets that would allow me to run a very profitable business?
* Who are the main regulators in Italy and which legislation has impacted wealth managers?
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Executive Summary
Sizing and forecasting the affluent population in Italy
Recent macroeconomic trends
National regulators protected the Italian financial market from the worst effects of the global economic crisis
In 2012 the Italian HNW population will return to pre-crisis levels
HNW customers in Italy
The typical Italian HNW individual is over 65 years old, male, and amassed his wealth through entrepreneurship
Italian HNW individuals typically gravitate towards cash or near-cash and fixed income products
There are crucial gaps in the service offerings of Italian wealth managers
Italian HNW investors have a low risk appetite and value personal relationships with their wealth manager
Italian HNW individuals are more loyal to their relationship manager than the companies which provide them
Competitor developments in Italian wealth management
The banking system can be segmented into two key pillars
The Italian wealth management market is dominated by large universal banks
There has been significant consolidation in the Italian banking sector in recent years
Italian banking institutions have shown limited activity in the social media space
OVERVIEW
Catalyst
Summary
Methodology
SIZING AND FORECASTING THE AFFLUENT MARKET IN ITALY
Macroeconomic overview
The Italian economy has been one of the worst performers in Western Europe in recent years
Italy's GDP is the fourth largest in Western Europe
The country has consistently recorded disappointing real GDP growth
Italian inflation is set to remain below 2.5%, after peaking at 3.4% in 2008
Long-term and short-term interest rates
Italy has seen its share of Western European market capitalization fall in recent years
Italy has the second highest Gini coefficient in Western Europe
Regulation of wealth management in Italy
Banca d'Italia and CONSOB are the principal regulatory bodies for the Italian financial and banking sector
Recent legislation and regulatory developments
Sizing and forecasting the Italian onshore affluent population
There were over 5.6 million mass affluent individuals in 2010 in Italy
There were over 85,000 Italian HNW individuals in 2010
The total liquid assets held by mass affluent individuals was lower in 2010 compared to 2006
Overall the liquid assets held by HNW individuals is still markedly lower in 2010 compared to 2006
HNW CUSTOMERS IN ITALY
Introduction
The typical Italian HNW individual is over 65 years old, male, and amassed their wealth through entrepreneurship
Women account for a smaller proportion of AUM in Italy than the Western European average
HNW individuals under 30 years old account for a smaller portion of AUM in Italy, compared to the overall European value
Entrepreneurship and inheritance remain the most common forms of wealth accumulation
Italian HNW investors allocate the majority of their assets to cash, near-cash, and fixed income products
Detailed asset analysis shows that deposit saving and corporate and government bonds represent over 57% of total asset allocation in Italy
There will be no significant changes in terms of Italian portfolio composition in the next two years
There are crucial gaps in the service offerings of Italian wealth managers
There are no significant differences in client service demand in the next two years
Demand for tax planning and advice is high across Western Europe, and is expected to grow further
Italian HNW individuals are open to new investment ideas, but remain risk averse
Italian HNW individuals put little emphasis on social media and online tools
Face-to-face meetings between wealth managers and HNW individuals remain very important in Italy
The majority of HNW individuals have one wealth manager
The majority of HNW individuals allocate over 70% of their portfolio to a single wealth manager
Italian HNW individuals have noticeable more loyalty in their client relationship manager than the company itself
The most successful method of acquiring new HNW clients in Italy is through referrals from existing clients
Client events are by far the best way to attract new HNW clients in Italy and Europe
COMPETITOR DEVELOPMENTS IN ITALIAN WEALTH MANAGEMENT
Introduction
Banks dominate wealth management in Italy, with limited asset management activity
There are broadly two forms of banking in Italy
IFAs have a limited role in Italian wealth management
Competitor trends
Geographic expansion
There has been significant consolidation in the Italian banking sector in recent years
Italian banking institutions have shown limited activity in social media
Key competitors in the Italian wealth management market
The universal banks dominate the Italian wealth management market
Competitor profile: BNL-BNP Paribas
Competitor profile: Intesa Sanpaolo Group
Competitor profile: MPS
Competitor profile: UniCredit
APPENDIX
Supplementary data
Definitions
High net worth (HNW)
Liquid assets
Mass affluent
Measures of growth
Onshore
Methodology
Overall methodology
Global Wealth Managers Survey 2011
Global Wealth Model methodology
Selected bibliography
Further reading
Ask the analyst
Datamonitor consulting
Disclaimer
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