High net worth (HNW) private
banks in the UK manage an estimated £886bn ($1.39trn), with the
wealth management industry in total managing more than £2.1trn in
private client assets, new research suggests.
The research, conducted by
consultants Scorpio Partnership, highlighted that these HNW banks
employ 22,700 staff, and mass affluent banks working as wealth
managers employ about 20,000 staff.
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When service providers, such
as lawyers, accountants and the IT industry are included, the
wealth industry is estimated to generate more than £30bn in annual
revenues.
The wealth management
industry was classified in the study as including UK HNW private
banks, mass affluent banks, private client investment managers and
independent financial advisers who manage assets for clients in
excess of £100,000.
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By GlobalDataPremier segment gives
best returns
The study was commissioned as the private banking and
wealth management industry gears up its lobbying of the UK
government on tax, regulatory and competitiveness issues affecting
the private wealth sector.
In November last year, the
Society of Trust and Estate Practitioners (STEP) set up a private
banking and wealth management group to ensure that the value of
private wealth is better understood by the UK
government.
Scorpio’s research suggested
that wealth management services for ‘premier’ clients, with
investable assets between £100,000 and £1m, are generating
significantly higher returns than the service providers at the
larger account sizes.
Typically the gross profit margins on these services are
as much as 25%-35% greater, Scorpio’s research
suggested.
