Stephan Schueller talks to Maryrose Fison about how
German bank Bankhaus Lampe bounced back from a loss in 2008 to
double its revenue last year, its refusal to construct domestic
investment products and its decentralised approach that hands local
decision-making back to its regional branches.
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For a country almost crippled by convention, Bankhaus
Lampe is an example of why it is good to break free from
conformity.
It is neither the oldest, largest, or
most modern private bank in Germany – yet it offers a refreshingly
simple proposition.
Unlike many of its contemporaries, the private
bank refuses to construct domestic products as part of a
long-standing and deliberate strategy to maintain complete
impartiality at all times.
Bankhaus Lampe has made this stance a defining
feature of its proposition and a concrete demonstration of its
commitment to independent financial advice.
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By GlobalDataMany of the bank’s clients are from the
so-called ‘old’ German industries typified by manufacturing,
trading and food production.
Advising locally
Its selection of locations for new branches
across Germany has often correlated to the areas known for having
high numbers of potential clients.
“The density of wealthy individuals and
proximity to mid-scale corporate companies is very relevant,” says
Stephan Schueller, spokesman for the general partners at Bankhaus
Lampe.
“Within Germany, people like to be advised on
money by people they feel are like them and from the same area –
people who speak the same language. In Germany, even 100km can be
too far for a customer to feel he is still connected to his bank
manager.”
The Oetker Family, which has held a 100% stake
in Bankhaus Lampe since 1964, also represents a step away from
convention. The family has interests cutting across more than 400
companies from luxury hotels to book publishing and an annual
turnover just less than €10bn ($12bn).
“It makes a difference whether the owner thinks
as an entrepreneur rather than as a banker. It eases access to the
customers,” says Schueller.
“If you go to a potential customer and tell
them: ‘We belong to an industrial conglomerate, we know how
entrepreneurs think and we know the problems small and medium-sized
entities have,’ it creates a certain kind of credibility.”
Oetker Family origins
The group has come a long way. In 1949, the
year Rudolph-August Oetker took a majority interest, Bankhaus Lampe
had ten employees, DM250,000 in equity capital (€127,823 in today’s
terms) and a single office.
Six decades on, it has €12bn in assets under
management (AuM), in excess of 6,000 clients and more than 600
members of staff working across a dozen branches in Germany. Last
year, the bank produced business volumes of €3.7bn, an equity of
€183m and a group revenue of €12m.
Private banking is understood to account for
around 50% of its total AuM, although the exact split of AuM
between private banking and its other operations (corporate banking
and institutional asset management) is a matter of commercial
sensitivity.
The bank has not escaped the contagion effect
of the credit crisis, despite making a healthy profit last year.
When the sub-prime mortgage market imploded in the summer of 2007,
the bank was, and still is, holding shares in Aareal Bank, a German
mortgage bank based in Wiesbaden. The drop in Aareal’s share value
contributed to an overall revenue loss of €12m in 2008. This was in
marked contrast to the €24m revenue gain the bank had generated a
year earlier.
Schueller says each of the bank’s business
divisions (private, corporate and institutional) contributed to the
impressive recovery last year, bolstered by an overall increase in
the number of clients coming on board and increased interaction
with existing clients.
Private client boost
Further mitigating the impact of the credit
crisis was the performance of private client portfolios, Schueller
says. The average value of portfolios rose by between 7% and 29%
last year dependent on the individual investment strategy.
Schueller aims to maintain these levels of return over the rest of
the year and also increase revenue by 15-20% over the next 12
months.
“There is a very simple reason why we will
achieve it: We added many more staff to our branches last year so
this allows us to maintain a very exclusive relationship between
our customers and our branches,” says Schueller.
Over the past three years, five new branches
have opened in Bonn, Bremen, Dresden, Osnabrueck and Stuttgart,
bringing the total to 12 and giving Bankhaus Lampe a presence in
each of Germany’s major cities.
The bank has no plans to open a further office
in Germany but has a small office offering institutional asset
management in London. There are currently no plans to expand its
international presence.
“We stick to our core competencies and to what
we are good at. A small bank of our size cannot compete with big
banks in international business. We offer other advantages and a
more individual service for our customers. The German market still
delivers enough potential for growth,” says Schueller.
Unlike many institutions, the firm takes a
decentralised approach to its decision-making. Major acquisition
decisions are made by the main board, but individual regional
branches are given leeway on how to go about achieving targets.
“The regional managers know their customers
best. This is crucial for business,” says Schueller. “It is more
attractive and motivating to act with a certain amount of freedom
within your own region than to just follow the orders from
above.”
