Table of Contents
Introduction
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- Report scope and definitions
- Abbreviations
- Key sources
Executive Summary
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- The market
- Identifying the Aspirational, Mass Affluent and Affluent & HNW market
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- Figure 1: Proportional breakdown of UK wealth, based on ownership of investable assets (excluding housing equity), 2013
- Market factors
- Switching service presents an opportunity for banks
- Impact of the RDR
- Companies, brands and innovation
- Main banking brands also exert their dominance in the affluent segment
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- Figure 2: Main current account provider, by segmentation of the wealth market, August 2013
- Adspend on banking products and services up by a fifth in 2012/13
- Who’s innovating?
- The consumer
- Segmentation of the Aspirational, Mass Affluent and Affluent & HNW markets
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- Figure 3: Segmentation of the wealth target market, by value of investable assets, August 2013
- Current account ownership
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- Figure 4: Current account ownership, August 2013
- Current account provider
- Influential factors for choosing an account
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- Figure 5: Influential factors when choosing an account, August 2013
- Reasons for overlooking a fee charging account
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- Figure 6: Reasons for not taking out a fee charging account, August 2013
- Current account switching
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- Figure 7: Account switching behaviour, August 2013
- Intentions of using the current account switching service
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- Figure 8: Current account switching intentions, August 2013
- What we think
Issues in the Market
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- Can firms target clients with multiple accounts?
- Will the new switching service encourage more people to change their account provider?
- What are the main influencing factors when affluent consumers choose accounts?
- Why do consumers overlook paid for, premium or full private accounts?
Trend Application
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- Bringing your bank to you
- Try before you buy
- Mintel futures: Generation Next
Market Drivers
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- Key points
- Many potential investors remain wary of taking on too much risk
- Switching service presents an opportunity for banks
- FSA cuts income limit for advice opt-out
- The FCA is looking to put in more stringent rules about ring-fencing client funds
- Shake-up in the retail banking scene
- Impact of the RDR
- MIFID II update
SWOT Analysis
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- Figure 9: Premium and mass affluent banking – SWOT analysis, 2013
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Who’s Innovating?
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- Key points
- Barclays launches a financial planning tool
- Citi Private Bank signs a new sponsorship agreement
- Roundup of some of the more exclusive private bank services
Market Size
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- Key points
- Around 16% of over 18s fall into the target wealth market
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- Figure 10: Proportional breakdown of UK wealth, based on ownership of investable assets (excluding housing equity), 2013
- HNW clients most likely to have accumulated wealth through employment
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- Figure 11: HNW wealth accumulation, June 2012
- Age has an impact on wealth accumulation
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- Figure 12: HNW wealth accumulation, by age, June 2012
- Affluent & HNW clients most likely to have private bank accounts
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- Figure 13: Current account ownership, by segmentation of the wealth target market, August 2013
Market Share
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- Key points
- Main banking brands also exert their dominance in the affluent segment
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- Figure 14: Main current account provider, by segmentation of the wealth market, August 2013
- Coutts and Barclays lead the way when it comes to AUM
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- Figure 15: Largest 15 wealth managers, by assets under management and number of client accounts – UK, 2011 and 2012
Companies and Products
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- Barclays
- Description
- Branch network
- Mass retail proposition
- Premium proposition for the mass affluent
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- Figure 16: Barclays premium current account – key features, August 2013
- Private banking for HNW
- Financial performance
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- Figure 17: Barclays UK Retail and Business Banking Division – key financial data, 2011 and 2012
- Figure 18: Barclays Wealth – key financial data, 2011 and 2012
- Recent activity
- Citibank
- Description
- Branch network
- Premium proposition for the mass affluent
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- Figure 19: Citibank’s Citigold current account – key features, August 2013
- Private banking for HNW
- Financial performance
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- Figure 20: Citicorp’s Global Consumer Banking division, EMEA region – key financial data, 2011 and 2012
- Recent activity
- Clydesdale Bank
- Description
- Branch network
- Mass retail proposition
- Premium proposition for the mass affluent
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- Figure 21: Clydesdale Bank’s premium account – key features, August 2013
- Financial performance
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- Figure 22: Clydesdale bank Plc – key financial data, 2011 and 2012
- Recent activity
- HSBC
- Description
- Branch network
- Mass retail proposition
- Premium proposition for the mass affluent
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- Figure 23: HSBC Premium account – key features, August 2013
- Private banking services for HNW
- Financial performance
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- Figure 24: HSBC Bank Plc’s UK Retail Banking and Wealth management division – key financial data, 2011 and 2012
- Recent activity
- Lloyds TSB
- Description
- Branch network
- Mass retail proposition
- Premium proposition for the affluent
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- Figure 25: Lloyds TSB’s premium/private bank account – key features, August 2013
- Private banking for HNW
- Bank of Scotland’s private banking
- Financial performance
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- Figure 26: LBG’s Wealth and International division – key financial data, 2011 and 2012
- Recent activity
- NatWest/RBS
- Description
- Branch network
- Mass retail proposition
- Premium proposition for mass affluent
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- Figure 27: RBS/NatWest premium/private bank account – key features, August 2013
- Private banking for HNW
- Financial performance
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- Figure 28: RBS Group’s Wealth division – key financial data, 2011 and 2012
- Recent activity
Brand Communication and Promotion
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- Key points
- Adspend on banking products and services up by a fifth in 2012/13
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- Figure 29: Total advertising expenditure on banking and asset management products and services, by product category, 2008/099-12/13
- Barclays continues to lead the way in advertising expenditure
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- Figure 30: Top five advertisers of packaged/premium accounts and mass-market wealth management services, 2010/11-12/13
- Press and internet advertising dominate the packaged and premium account market
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- Figure 31: Share of advertising expenditure on packaged/premium accounts, by media type, 2008/099-12/13*
- A note about adspend
Channels to Market
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- Key points
- Having an accessible branch network is important
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- Figure 32: Number of branches operated, by the top six retail banking groups, start 2013
- Online banking leading the way in client interaction
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- Figure 33: Frequency of using banking services provided by main current account provider, June 2013
Profile Analysis of the Wealth Target Market
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- Key points
- Survey coverage
- Wealth tiers among affluent consumers
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- Figure 34: Segmentation of the wealth target market, by value of investable assets, August 2013
- Older male clients well represented in the target wealth market
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- Figure 35: Profile of wealth target market based on wealth tier, by gender and age, August 2013
- Investable assets can be more important than income for private banks
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- Figure 36: Profile of wealth target market based on wealth tier, by working status, August 2013
- Engaging with the future generation of Affluent & HNW consumers
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- Figure 37: Profile of wealth target market based on wealth tier, by child age, August 2013
Current Account Ownership
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- Key points
- A fifth of the target wealth market have a premier or fully private account
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- Figure 38: Current account ownership, August 2013
- Affluent & HNW clients most likely to have private bank accounts
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- Figure 39: Current account ownership, by segmentation of the wealth target market, August 2013
- A third of 18-44-year-olds have a premier or full private bank account
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- Figure 40: Current account ownership, by age, August 2013
Current Account Provider
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- Key points
- Main retail banks lead the way even in the target wealth market
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- Figure 41: Main current account provider, August 2013
- Lloyds TSB slightly more popular among Aspirational clients
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- Figure 42: Main current account provider, by segmentation of the wealth market, August 2013
Influential Factors for Choosing an Account
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- Key points
- Easy to use online banking tools most influential when picking an account
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- Figure 43: Influential factors when choosing an account, August 2013
- Premier and full private account holders more likely to place importance on value-added services
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- Figure 44: Influential factors when choosing an account, by Current account ownership, August 2013
- LBG and RBS Group clients more likely to value an accessible branch
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- Figure 45: Influential factors when choosing an account, by main current account provider, August 2013
Reasons for Overlooking a Fee Charging Account
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- Key points
- Even many affluent consumers are not willing to pay for current accounts
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- Figure 46: Reasons for not taking out a fee charging account, August 2013
- Around 11% of the target wealth market have never looked at paid for accounts
- LBG clients more likely to have reverted to a regular current account
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- Figure 47: Reasons for not taking out a fee charging account, by current account provider, August 2013
- Little disparity in barriers among the three wealth tiers
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- Figure 48: Reasons for not taking out a fee charging account, by segmentation of the wealth market, August 2013
Current Account Switching
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- Key points
- Two thirds of affluent consumers have switched their current account
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- Figure 49: Account switching behaviour, August 2013
- Over-65s least likely to have switched current accounts before
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- Figure 50: Account switching behaviour, by age, August 2013
- Regular current account users less likely to have switched recently
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- Figure 51: Account switching behaviour, by current account ownership, August 2013
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- Figure 52: Account switching behaviour, by segmentation of the wealth target market, August 2013
Intentions of Using the Current Account Switching Service
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- Key points
- Hopes that switching service will boost current account competition
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- Figure 53: Current account switching intentions, August 2013
- Previous account switchers more likely to make use of the new service
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- Figure 54: Current account switching intentions, by account switching behaviour, August 2013
- Private/premier account holders more likely to plan on switching
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- Figure 55: Current account switching intentions, by current account ownership, August 2013
Appendix – Profile Analysis of the Wealth Target Market
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- Figure 56: Segmentation of the wealth target market, by demographics, August 2013
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Appendix – Current Account Ownership
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- Figure 57: Current account ownership, by demographics, August 2013
- Figure 58: Ownership of private/premier and full private bank accounts, August 2013
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Appendix – Current Account Provider
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- Figure 59: Main current account provider, by demographics, August 2013
- Figure 60: Main current account provider continued, by demographics, August 2013
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Appendix – Influential Factors for Choosing an Account
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- Figure 61: Most influential factors when choosing an account, by demographics, August 2013
- Figure 62: Influential factors when choosing an account, by demographics, August 2013
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- Figure 63: Least influential factors when choosing an account, by demographics, August 2013
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Appendix – Reasons for Overlook a Fee Charging Account
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- Figure 64: Main reasons for not taking out a fee charging account, by demographics, August 2013
- Figure 65: Other reasons for not taking out a fee charging account, by demographics, August 2013
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Appendix – Current Account Switching
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- Figure 66: Account switching behaviour, by demographics, August 2013
- Figure 67: Switching and non-switching behaviour, by demographics, August 2013
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Appendix – Intentions of Using the Current Account Switching Service
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- Figure 68: Current account switching intentions, by demographics, August 2013
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