Introduction
The report discusses why lending should form an important part of the wealth managers business before examining the three most suitable areas of lending for high net worths, including examples of wealth managers that are fulfilling this customer segments needs in each area. Finally, seven conclusions to help wealth managers decide how best to capitalize on this important segment are presented.
Scope of this report
- In-depth interviews were carried out with senior executives within wealth managers that currently make lending a key part of their business
- Extensive research on wealth managers, both in the US and Europe, to determine the extent to which lending products are marketed to high net worths
Research and analysis highlights
According to IRS data, in the US, individuals with more than USD600,000 in net worth accounted for 70% of debt and mortgage balances, compared to 20% of balances held by people with positive net worth of less than USD600,000.
Despite the fact that wealthy individuals borrow a disproportionate amount of money relative to their numbers and that they are less likely to default on their loans than less wealthy individuals, relatively few wealth managers are capitalizing on this opportunity.
Most retail banks that started with lending capability now have wealth management businesses, giving them two important points of initial contact with a prospective client. Wealth managers that dont offer to manage their clients liabilities are likely to lose clients to lending banks that can also manage their assets.
Key reasons to read this report
- Assesses a very lucrative and underserved business segment that you can exploit
- Identifies innovations in high net worth lending that can be adopted to fit your business model
- Presents the key conclusions to help you decide whether high net worth lending is right for you
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