866-997-4948(US-Canada Toll Free)

Premium and Mass Affluent Banking - UK - November 2013

Published By :

Mintel

Published Date : Nov 2013

Category :

Banking

No. of Pages : 101 Pages


For banks targeting the affluent market offering a holistic approach can be important strategy and the focus should not just be around premier accounts. Firms can target new customers by offering to provide and manage a suite of accounts in order to cater for clients’ particular financial situations and needs.
Table of Content

Introduction
Report scope and definitions
Abbreviations
Key sources

Executive Summary
The market
Identifying the Aspirational, Mass Affluent and Affluent & HNW market
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
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
Figure 3: Segmentation of the wealth target market, by value of investable assets, August 2013
Current account ownership
Figure 4: Current account ownership, August 2013
Current account provider
Influential factors for choosing an account
Figure 5: Influential factors when choosing an account, August 2013
Reasons for overlooking a fee charging account
Figure 6: Reasons for not taking out a fee charging account, August 2013
Current account switching
Figure 7: Account switching behaviour, August 2013
Intentions of using the current account switching service
Figure 8: Current account switching intentions, August 2013
What we think

Issues in the Market
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
Bringing your bank to you
Try before you buy
Mintel futures: Generation Next

Market Drivers
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
Figure 9: Premium and mass affluent banking – SWOT analysis, 2013

Who’s Innovating?
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
Key points
Around 16% of over 18s fall into the target wealth market
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
Figure 11: HNW wealth accumulation, June 2012
Age has an impact on wealth accumulation
Figure 12: HNW wealth accumulation, by age, June 2012
Affluent & HNW clients most likely to have private bank accounts
Figure 13: Current account ownership, by segmentation of the wealth target market, August 2013

Market Share
Key points
Main banking brands also exert their dominance in the affluent segment
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
Figure 15: Largest 15 wealth managers, by assets under management and number of client accounts – UK, 2011 and 2012

Companies and Products
Barclays
Description
Branch network
Mass retail proposition
Premium proposition for the mass affluent
Figure 16: Barclays premium current account – key features, August 2013
Private banking for HNW
Financial performance
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
Figure 19: Citibank’s Citigold current account – key features, August 2013
Private banking for HNW
Financial performance
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
Figure 21: Clydesdale Bank’s premium account – key features, August 2013
Financial performance
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
Figure 23: HSBC Premium account – key features, August 2013
Private banking services for HNW
Financial performance
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
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
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
Figure 27: RBS/NatWest premium/private bank account – key features, August 2013
Private banking for HNW
Financial performance
Figure 28: RBS Group’s Wealth division – key financial data, 2011 and 2012
Recent activity

Brand Communication and Promotion
Key points
Adspend on banking products and services up by a fifth in 2012/13
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
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
Figure 31: Share of advertising expenditure on packaged/premium accounts, by media type, 2008/099-12/13*
A note about adspend

Channels to Market
Key points
Having an accessible branch network is important
Figure 32: Number of branches operated, by the top six retail banking groups, start 2013
Online banking leading the way in client interaction
Figure 33: Frequency of using banking services provided by main current account provider, June 2013

Profile Analysis of the Wealth Target Market
Key points
Survey coverage
Wealth tiers among affluent consumers
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
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
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
Figure 37: Profile of wealth target market based on wealth tier, by child age, August 2013

Current Account Ownership
Key points
A fifth of the target wealth market have a premier or fully private account
Figure 38: Current account ownership, August 2013
Affluent & HNW clients most likely to have private bank accounts
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
Figure 40: Current account ownership, by age, August 2013

Current Account Provider
Key points
Main retail banks lead the way even in the target wealth market
Figure 41: Main current account provider, August 2013
Lloyds TSB slightly more popular among Aspirational clients
Figure 42: Main current account provider, by segmentation of the wealth market, August 2013

Influential Factors for Choosing an Account
Key points
Easy to use online banking tools most influential when picking an account
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
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
Figure 45: Influential factors when choosing an account, by main current account provider, August 2013

Reasons for Overlooking a Fee Charging Account
Key points
Even many affluent consumers are not willing to pay for current accounts
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
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
Figure 48: Reasons for not taking out a fee charging account, by segmentation of the wealth market, August 2013

Current Account Switching
Key points
Two thirds of affluent consumers have switched their current account
Figure 49: Account switching behaviour, August 2013
Over-65s least likely to have switched current accounts before
Figure 50: Account switching behaviour, by age, August 2013
Regular current account users less likely to have switched recently
Figure 51: Account switching behaviour, by current account ownership, August 2013
Figure 52: Account switching behaviour, by segmentation of the wealth target market, August 2013

Intentions of Using the Current Account Switching Service
Key points
Hopes that switching service will boost current account competition
Figure 53: Current account switching intentions, August 2013
Previous account switchers more likely to make use of the new service
Figure 54: Current account switching intentions, by account switching behaviour, August 2013
Private/premier account holders more likely to plan on switching
Figure 55: Current account switching intentions, by current account ownership, August 2013

Appendix – Profile Analysis of the Wealth Target Market
Figure 56: Segmentation of the wealth target market, by demographics, August 2013

Appendix – Current Account Ownership
Figure 57: Current account ownership, by demographics, August 2013
Figure 58: Ownership of private/premier and full private bank accounts, August 2013

Appendix – Current Account Provider
Figure 59: Main current account provider, by demographics, August 2013
Figure 60: Main current account provider continued, by demographics, August 2013

Appendix – Influential Factors for Choosing an Account
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
Figure 63: Least influential factors when choosing an account, by demographics, August 2013

Appendix – Reasons for Overlook a Fee Charging Account
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

Appendix – Current Account Switching
Figure 66: Account switching behaviour, by demographics, August 2013
Figure 67: Switching and non-switching behaviour, by demographics, August 2013

Appendix – Intentions of Using the Current Account Switching Service
Figure 68: Current account switching intentions, by demographics, August 2013

Make an enquiry before buying this Report

Please fill the enquiry form below.

  • Full Name *
  • Your Email *
  • Job Title
  • Company *
  • Phone No. * (Pls. Affix Country Code)
  • Message
  • Security Code *

Upcoming Reports

  • Sugar and Gum Confectionery - UK - January 2015

    Rising dental health concerns can create an opportunity for chewing gum brands. Currently much of the marketing for sugar-free gums centres around fresh breath, however, the dental health benefits, particularly for children, could warrant more focus. Though explored internationally, tooth-friendly gums tailored for children remain rare in the UK market....