Private Banking

Presented by
Souvik Banerjee
Asst.Professor
Sri Sri Institute of Management,Margao
 Who can be a client
• Private banking is for HNWI
• Internationally a millionaire in USD is
eligible for private banking services
• In India this number is different for
different banks and varies between INR 10
million to INR 500 million.
• Usually, INR 25 million of investible
surplus will qualify one as a private
banking client
 Majors players in India
• HSBC
• Kotak Mahindra Bank Ltd
• Standard Chartered
• HDFC Bank
• ICICI Bank
• Yes Bank
• JM Financial
• Deutsche Bank
• Citi Bank
• BNP Paribas
 Location
Most of the players provide this service in
metros, i.e. Delhi, Mumbai, Bangalore,
Hyderabad, Chennai and Kolkata

4 states in India are in focus for most

players for their rapid increase in wealth,
they are Maharashtra,Tamilnadu,Karnataka
and Delhi
Reasons of recent growth of private
banking
• High growth rate of Indian economy
• Stake sale by promoters of many closely
held companies
• High growth rate of service sector, and the
entrepreneurs associated with it.
• Prevalence of ESOP among high
performers in corporate sector
 Typical client profile
• Entrepreneurs
• Doctor
• Lawyers
• Corporate high fliers
 NRI angle
• A large number of clients are NRI or PIO
• A lucrative segment for private bankers,
total number of investors in this category is
estimated to be in excess of 25 million
 Events
• Wine and cheese tasting evenings
• Exclusive performance by top notch
performers
• Talks given by international personalities
 Promotion of private banking
• Most of the clients are through referrals
 Types of probable investors
• Wealth creators

• Wealth preservers
 Services provided by private
bankers
• Advisory Service

• Custodial Service
 Investment Avenues
Most local players use ‘open architecture’
to use third party products, to be able to
offer best in class products to private
banking customers. Open architecture
model ensures that focus remains on
customer and not on in house products
 Existing Products
• Mutual Fund
• Direct equity advice
• Portfolio Management Services
• Fixed income/debt market products,
government bond ,corporate bond
• Direct investment in real estate
• Insurance
 Upcoming products
• Commodities PMS
• Art Fund
• Estate planning trust and tax advisory
services
• Real Estate mutual funds/Real estate
investment trust (REIT)
• Private equity/Venture Capital Fund
• Fine wine
 Essential Skills to become private
banker
• Investment product knowledge

• Relationship management skills

 Future Trends
• Product Innovation
• Capital account convertibility
• Private banking and private equity
 Challenges in India
• High prevalence of black money
• Lack of estate planning and trust
• Fewer investment avenues
• HNWIs still take advice from chattered
accountants, friends, stock brokers