Wealth Management in Belgium and The Netherlands 2006

• Sizing and forecasting of mass affluent and high net worth individuals were generated from Datamonitor's proprietary Global Wealth Model.
• Assesses competitive developments including mergers and acquisitions among the region's main players.
• Key companies covered: ABN Amro Private Banking, Fortis & Petercam.
• Geography: Belgium and the Netherlands.

• Assess market attractiveness by reviewing size and growth forecasts up to 2010.
• Formulate strategies to increase market share by gathering intelligence on level of competition.
• Learn strategies to enhance share of wallet from client base.

EXECUTIVE SUMMARY

Introduction

Wealthy Clients in Belgium & the Netherlands

Competition for Wealthy Customers

Products & Distribution

INTRODUCTION

What is this report about?

Who is the target reader?

How to use this report

CHAPTER 1 WEALTHY CLIENTS IN BELGIUM & THE NETHERLANDS

Introduction

Key findings

Belgium & the Netherlands represents an attractive market for onshore wealth management

There are over three and a half million wealthy individuals in Belgium & the Netherlands today

They hold EUR667bn in onshore liquid assets

Individuals will grow by roughly 1 million by 2010

Onshore liquid assets will grow by 35% to EUR902bn by 2010

Entrepreneurs represent the biggest opportunity in Belgium & the Netherlands

And wealthy Belgian & Dutch clients put less than 10% of their portfolio offshore (mainly to avoid tax)

Switzerland and Luxembourg are the most popular offshore destinations for Belgian & Dutch investors

The primary concern of Belgian & Dutch clients today is protection of their asset base

Clients in Belgium & the Netherlands are financially sophisticated and demanding, but loyal, and heavily influenced by personal relationships

Personal relationships are the number one determinant of choice of wealth managers in Belgium & the Netherlands

As a result, referrals from existing clients were cited as the number one customer acquisition technique by all Belgo-Dutch asset managers

However, attracting clients does not mean keeping them: clients are more likely to change their wealth manager today than they were two years ago

Clients are demanding to know more about their investments because asset management is their main concern

Talking to clients regularly, being proactive with investment suggestions, and ensuring all problems are resolved quickly and completely are the best ways to retain clients

Belgian & Dutch clients leave their wealth manager when they have made too many errors and small mistakes

Clients in Belgium & the Netherlands tend to have two wealth managers, but they tend to hold between 51-70% with a single wealth manager on average

And they have been with their current wealth manager for 5-10 years on average

Supplementary Data

CHAPTER 2 COMPETITION FOR WEALTHY CUSTOMERS

Introduction

Key findings

Wealth management in Belgium & the Netherlands is concentrated, and dominated by domestic providers

Fortis, ABN Amro and Petercam are perceived by their peers to be the largest wealth managers in the Belgo-Dutch market

ABN Amro

Fortis

Fortis is perceived to be the biggest wealth manager in the Belgo-Dutch region

Petercam

Petercam is one of the top three leading institutions in the Benelux region

Thresholds in the Belgo-Dutch region vary between local wealth managers

There has been little interest from foreign wealth managers in Belgium & the Netherlands

As a result, foreign competition isn't what concerns incumbent wealth managers most

Belgian & Dutch asset managers feel that finding and attracting quality staff is their most pressing concern at present

Large-scale wealth managers have a threatening presence in the market

Competitors for the next three years will remain the same

Wealth managers in Belgium & the Netherlands are concentrating on getting more clients and increasing the share of their clients' wallets

Despite the additional costs, wealth managers think new clients will drive revenue

Increasing share of wallet is also important, and will come through offering financial planning and increased face to face contact

Financial planning and alternative investments have the greatest business potential in the Belgo-Dutch region

Most are missing a significant opportunity to generate revenue from their lending capabilities

CRM and support system improvements are the main strategic initiatives planned

As a result, IT & CRM system costs will be the main concern in controlling cost bases

Wealth managers in Belgium & the Netherlands tend to organize their business around a key relationship manager, but few specialize in key client segments

38% of wealth managers in Belgium & the Netherlands give their clients a named relationship manager who coordinates with other specialists

As a result, some wealth managers have dedicated teams organized around customer groups

And relationship managers are measured by the client satisfaction rate and number of clients

Although most Belgo-Dutch wealth managers are concentrating on CRM & support systems, human resourcing is still a significant issue

77% of wealth managers in the Belgo-Dutch region are concentrating on CRM and support systems

And new relationship managers will come mostly through hiring from other wealth managers

Supplementary Data

CHAPTER 3 PRODUCTS AND DISTRIBUTION

Introduction

Key findings

Expanding product range and improving investment performance will be important revenue growth drivers in Belgium & the Netherlands

38% of wealth managers in Belgium & the Netherlands think that strengthening their product range will be the key to revenue growth in the next two years

Alternative investments, inheritance planning and financial planning have the most potential in Belgium & the Netherlands

Wealth managers will focus on roughly the same product areas in the next two years

And clients are currently most concerned about protecting their investment

Wealth managers are only mildly interested in developing new distribution channels

Instead, more than three quarters of wealth managers in Belgium & the Netherlands will be focusing on improving CRM and support systems in the next year

Financial advisors are an important distribution channel in Belgo-Dutch wealth management

Three quarters of wealth managers agree that financial advisors will be an important distribution channel for their wealth management business in three years

Supplementary Data

APPENDIX

Supplementary data

Definitions

Aggregate

CAGR

High net worth (HNW)

Liquid assets

Liquid asset bands

Mass affluent

BENELUX

Research methodology

Wealth Management Market Leaders Survey 2006

Global Wealth Model Methodology

The UK sub model

European sub model

Forecasting methodology

Continuous refinement to the understanding of liquid wealth distribution

Datamonitor's wealth numbers compared with other wealth numbers

Further Reading

Global Wealth Management SPP

Interactive Databases

Market Reports

Strategic Insight Reports

Wealth Management Competitor Tracker

Datamonitor Asia Pacific Wealth Management SPP

SPP writing team

List of Tables

Table 1: Number of wealthy individuals in Belgium & the Netherlands, segmented by asset band, 2001-2005

Table 2: Levels of aggregate liquid wealth held in Belgium & the Netherlands, segmented by asset band, EURbn, 2001-2005

Table 3: Number of wealthy individuals in Belgium & the Netherlands, segmented by asset band, 2006-2010

Table 4: Levels of aggregate liquid wealth held in Belgium & the Netherlands, segmented by asset band, EURbn, 2006-2010

Table 5: Client types offering the greatest potential in the Belgo-Dutch region over the next five years

Table 6: Proportion of liquid assets placed offshore by Belgo-Dutch investors

Table 7: Reasons for Belgo-Dutch investors to place their money offshore

Table 8: Nations where Belgian/Dutch investors prefer to put their offshore money

Table 9: Issues of interest to Belgo-Dutch clients today

Table 10: Factors influencing a client's choice of wealth management service

Table 11: Most effective customer acquisition techniques in the Belgian/Dutch market

Table 12: Wealth manager agreement/disagreement with certain statements

Table 13: Wealth manager agreement/disagreement with certain statements (cont'd)

Table 14: Most popular methods of retaining clients in the Belgo-Dutch market

Table 15: Reasons that convince clients to leave a wealth management service

Table 16: Agreement statement as to the number of wealth managers held by the average Belgo/Dutch client

Table 17: Share of clients' wallet held by Belgo-Dutch wealth managers

Table 18: Length of average client relationship in Belgium/the Netherlands

Table 19: Key Petercam operating figures, 2001-2005, EURm (except for staff numbers)

Table 20: Top 7 wealth managers in Belgium/the Netherlands

Table 21: Minimum asset threshold for new clients

Table 22: Most pressing business concerns for Belgo-Dutch wealth managers

Table 23: Main Belgian/Dutch wealth manager competitors

Table 24: Main Belgian/Dutch wealth manager competitors in three years

Table 25: Main drivers of revenue growth in the Belgian/Dutch market over the next two years

Table 26: Methods of increasing a client's share of wallet

Table 27: Product business potential among wealthy clients over the next two years

Table 28: Product business potential among wealthy clients over the next two years

Table 29: Strategic initiatives considered/being implemented by Belgian and Dutch wealth managers over the next year

Table 30: Main areas of concern for Belgo-Dutch wealth managers in controlling their cost base

Table 31: Belgo-Dutch wealth managers' relationship management structure

Table 32: Percentage of Belgo-Dutch wealth managers who have dedicated teams set up for specific customer groups

Table 33: Quantitative measures used to assess wealth manager performance

Table 34: Strategic initiatives under consideration by Belgo-Dutch wealth managers for the next year

Table 35: Sources of new staff for Belgo-Dutch wealth managers over the next three years

Table 36: Areas where Belgo-Dutch wealth managers will focus their resources over the next two years

List of Figures

Figure 1: Belgian & Dutch investors are most concerned with protecting their current asset base

Figure 2: Over three quarters of Belgo-Dutch asset managers apply a minimum asset threshold between EUR250k-EUR1m

Figure 3: Financial planning, alternative investments & inheritance planning have the most business potential over the next couple of years

Figure 4: The majority of wealthy Belgo-Dutch individuals are concentrated in the lower asset bands

Figure 5: Nearly a quarter of liquid wealth held by Belgo-Dutch individuals lies in the EUR150-300k asset band

Figure 6: The majority of wealthy individuals in the Belgo-Dutch region are forecast to have between EUR50-75k in liquid assets

Figure 7: Liquid wealth held by Belgo-Dutch individuals will continue to be mainly held in the EUR150-300k asset band

Figure 8: Just over half of Belgo-Dutch asset managers believe entrepreneurs offer the greatest potential for the next five years

Figure 9: Wealthy clients in Belgium & the Netherlands tend to put under 10% of their portfolio offshore

Figure 10: Nearly 60% of asset managers believe clients put money offshore for purposes of tax evasion

Figure 11: Belgian & Dutch investors prefer to put their offshore money in Switzerland and Luxembourg

Figure 12: Belgian & Dutch investors are most concerned with protecting their current asset base

Figure 13: Personal relationships are a key determinant for a Belgian/Dutch client's choice of wealth management service

Figure 14: Referrals from existing clients were cited by all Belgo-Dutch asset managers as the most effective means of acquiring new clients

Figure 15: Client demands are much stronger than they were two years ago, although financial advisors remain an important distribution channel both today and in the future

Figure 16: Just under two thirds of Belgo-Dutch wealth managers believe clients are most interested in protecting their current asset base

Figure 17: Approximately two thirds of Belgo-Dutch asset managers believe that regular communication is the best way to retain clients

Figure 18: Errors and small mistakes are the most likely reasons for clients to leave a wealth management service

Figure 19: Most Belgo-Dutch wealth managers say their company is one of two main wealth managers for their client base

Figure 20: Nearly half of Belgo-Dutch asset managers believe they hold between 51-70% of their clients' wallet

Figure 21: More than half of Belgo-Dutch asset managers' current client base have been with them for 5-10 years

Figure 22: Belgo-Dutch asset managers believe Fortis to be the biggest wealth manager in their region

Figure 23: Over three quarters of Belgo-Dutch asset managers apply a minimum asset threshold between EUR250k-EUR1m

Figure 24: Nearly two thirds of Belgo-Dutch asset managers highlight finding and attracting quality staff as their biggest concern today

Figure 25: 90% of Belgo-Dutch asset managers believe that large wealth managers pose a significant threat to their business

Figure 26: The scenario for the next three years, will see the main competitors remain unchanged

Figure 27: Nearly a third of responses by Belgo-Dutch asset managers, portray the belief that obtaining new clients will be the main driver for revenue growth in the next two years

Figure 28: Just over half of Belgo-Dutch asset managers believe that financial planning and increased face to face contact are the best ways to increase share of wallet

Figure 29: According to Belgo-Dutch asset managers, financial planning and alternative investments have the greatest business potential over the next two years

Figure 30: Lending products are perceived to have a much lower business potential among wealthy clients over the next two years

Figure 31: Over three quarters of Belgian & Dutch asset managers are considering improving CRM and support systems in the next year

Figure 32: The majority of Belgo-Dutch asset managers cite IT & CRM system costs as the main area of concern for controlling their cost base

Figure 33: Just over a third of Belgo-Dutch asset managers provide their client with a named relationship manager who coordinates with other specialists in the company

Figure 34: Nearly half of Belgian & Dutch asset managers have dedicated teams set up to attract entrepreneurs and small business owners

Figure 35: Approximately half of Belgo-Dutch wealth managers use client satisfaction rate to assess the performance of relationship managers

Figure 36: Over three quarters of Belgian & Dutch asset managers are considering improving CRM and support systems in the next year

Figure 37: 85% of Belgian and Dutch wealth managers will poach their staff from other wealth managers over the next three years

Figure 39: Belgian/Dutch wealth managers believe that strengthening product range and improving investment performance will be important determinants of future growth

Figure 39: Financial planning, alternative investments & inheritance planning have the most business potential over the next couple of years

Figure 40: The business potential of lending products over the next two years is minimal

Figure 41: Wealth managers in Belgium & the Netherlands will focus most of their resources on investments, as well as financial & inheritance planning

Figure 42: Although clients are most interested in protecting their investment, there is also significant interest in tax optimization and retirement planning

Figure 43: Although referrals from clients are the most popular acquisition technique, financial advisors still have a very important part to play

Figure 44: Three quarters of wealth managers agree that financial advisors will be an important distribution channel in three years