Macquarie Group is to merge its private wealth and private banking businesses to focus on high net worth clients. The bank has also confirmed advisers will be laid off but has given no details on numbers.
“Macquarie is supporting these advisers in a number of ways, including by facilitating discussions with other firms and assisting with their transition,” the bank said.
It emphasised the move does not change its strategy “to continue to grow its retail banking activities through offering home lending, deposit and credit card solutions for all consumer clients”.
The bank also gave no details of its strategy for moving clients out of private wealth or the level of discretion on client minimums available to relationship managers to retain business in the new HNW division.
High net worth clients are the exclusive focus of Macquarie’s private bank and a substantial proportion of its private wealth business.
HNW growth
The bank cited high net worth client segment figures as driving the move. Australia ranks inside the top 10 countries globally for high net worth individuals, with more than 1.2 million adults with wealth of $A1.3m or more.
Its high net worth is a segment that has grown by 7.4%, or approximately 80,000 adults, since 2011.
Macquarie’s head of wealth management, Bill Marynissen, said: “We are striving to create a comprehensive and tailored wealth and banking offering for our clients that can take them from the wealth accumulation stage of their lives, through to retirement. Concentrating on one client segment enables us to better deliver on this commitment.
“Focusing on attracting high net worth clients is a logical evolution of our private client business and we believe it is a space in which we can be a market leader. We have carefully assessed growth opportunities in the high net worth segment against the strong fundamentals of our business.
“These include a deep understanding of the high net worth segment, our wealth and banking expertise and suite of solutions, and the capacity to build on our existing digital capabilities.”
Banking and Financial Services
Private wealth and private banking sit within Macquarie’s Banking and Financial Services (BFS).
While there are no private wealth figures in its latest results, BFS delivered a net profit contribution of $A560m for FY2018, up 9% from $A513m in FY2017.
Macquarie said the improved result reflects increased income from growth in average Australian loan, deposit and platform volumes, as well as the non-recurrence of expenses recognised in the prior year.
