For private bankers, sharp market downturns can conjure up images of upset and demanding clients.
But this has not been the experience, says UK chief executive Richard Thomas, of the advisers at EFG Private Bank, who have found that during the Covid-19 pandemic, the relationships they hold with clients have led to more human interactions.
“Our clients have been with our CROs (Client Relationship Officers) for long periods,” Mr Thomas says.
“That has paid dividends. Contact has become a lot more personal during the crisis. It’s not ‘where is my portfolio pricing today?’, it’s firstly ‘how are you? Are you safe and well?’.”
EFG’s chief investment officer has been running regular webinars for clients focused on their different areas of interest. These have been heavily attended, Mr Thomas says.
“It’s about making sure clients stay the course – as it’s about time in the market rather than timing the market. You can’t mend the roof when it’s raining, and we are fortunate in that we have trust in those long-term relationships.”
And when it comes to relationships within the firm, Mr Thomas says it has been a matter of adapting and making an extra effort to engage and empathise with his staff.
“Remote leadership is a challenge, but that has always been the case. When connecting through video or via the phone, you do have to make an effort to be more human, more empathetic, and make the emotional connection with both the topic and the person. We are now separated by these screens and you can sometimes lose the sense of what people are trying to say.
“I have been very clear from the outset that the priority is our people, making sure they are safe, secure and confident so they in turn can work and look after our clients to the best of their ability.”
He says the firm’s leadership has also become more aware of the fact that – given the relentless digital communication of home-working – people need to be taking proper breaks, and ideally signing off over weekends.
Richard Thomas
Mr Thomas previously served in the Royal Navy for 20 years, as a warship Captain and, latterly, at the Ministry of Defence. He was awarded an MBE for services abroad in 2000, before starting his City career and joining Barclays in 2008, going on to become the chief operating officer of its private bank. He joined EFG Private Bank as its UK head at the start of 2019.
EFG Private Bank, which employs 400 people in the UK, is part of a Swiss-headquartered international group which manages the equivalent of £118 billion (CHF 139.7 billion) internationally (correct as of 29 April 2020).
Mr Thomas says this international presence was invaluable when the pandemic began to escalate, as the firm’s European branches felt they had advanced warning from colleagues in Singapore and Hong Kong.
“From a crisis management point-of-view we were quite well-prepared and had a full rehearsal prior to it all breaking. We implemented a gradual changeover from all being in the office to nearly all at home.”
This was a positive that could be taken from the circumstances – necessity had forced the firm to make rapid advances both in terms of flexible working practices for staff and tools and tech for clients.
“Six months ago, I wouldn’t have thought [this level of home working] was possible,” he says.
“We will learn a lot out of this crisis, and we won’t give up those gains when we go back to a normal operating environment.”
When the group reported its first quarter results in April, it named the UK as a lead contributor in terms of net new assets, despite the market turmoil that engulfed the sector in March.
Mr Thomas says there is still a strong pipeline of new business to see the UK bank through May and it had just concluded a project to make onboarding paperless. But he also acknowledged that client asset growth may drop off if the lockdown drags on and the “social activity that creates those opportunities dies away”.
When asked whether he thinks the pandemic will lead to consolidation – and potentially acquisition opportunities – within the private wealth space, Mr Thomas says he believes retail-focused banks will bear the brunt of the hardship.
“UK private banking and wealth management covers a lot of different firms, so it is hard to generalise. I do imagine there will be distress. The market was consolidating [before Covid-19] and I see no reason to doubt that will accelerate.
“But there are always real people on the end of any distress. We are always open to opportunities, but on the end of those opportunities, under these conditions, are people. I hope everyone weathers the storm and gets through it. I’m not one for waiting on the side-lines and hoping [another firm] does badly.
And from the ex-military man I have to wait right until the end of our conversation for any war analogies to creep in, in response to a question about how he believes the present saga will play out in comparison to the 2008-09 debt crisis.
Mr Thomas says he believes the recovery will be faster.
“This (Covid-19) is about a common enemy that we at some point will come to understand and defeat. The previous crisis was such a confidence shock to the world that it has taken a long time to get over.
“Don’t fight the last war, fight the war you’re in. We should be dealing with what we see in front of us… rather than try and relate it to some doom-laden forecast based on the past.”
