Private banking includes providing banking, investment, tax management, and other financial services to high earning people. Unlike commercial retail banking, private banking focuses on offering more personalised financial services to the customers, through banking employees particularly dedicated to providing such individual services.
High earning people are capable of accessing different investments, such as hedge funds and real estate. Private banking provides customer information and advice regarding what may be the most suitable investment options for them.
There are several consumer banks with private banking divisions, which assist a high net worth individual in caring and building their assets. Clients with top accounts receive attractive benefits and exclusive personalized services, including guaranteed instant access to specific employees working with their accounts. Clients can communicate with the lead banker allotted to their account and complete several transactions on the phone, without going at the bank.
Advantages of Private Banking
Banks target extremely affluent individuals because doing so provides them major returns and guarantees regular income from customers. Private banking clients take advantages in the following ways:
Services such as customer dealings, transactions, etc. provide to high net worth individuals usually remain anonymous. Banks offer their private banking customers with proprietary products that they keep confidential to prevent competitors from trying to sell similar products to the same customers.
The culture of privacy attracts to the high net worth individual because it offers them the ability to hide personal information that, if publicly known, might offer an undue advantage to their business rivals. They need to keep their financial dealings as private as possible because there is always a possibility of lawsuits involving their investments. Keeping such details confidential gives them a greater sense of security.
A bank can provide discounted services as a return for the large volume of business that high net worth individual bring to the bank. Tax preparation, corporate checking, estate management, etc. are some of the popular private banking services grab at a good discount. Export and Import business clients can receive good foreign exchange rates. Real estate clients benefit from the fast and timely processing of their transactions through the supervisors of their accounts.
High Investment Returns
Banks often assigned their best-performing employee to their private banking division to manage the accounts of high net worth individuals. This practice usually converts to higher investment returns for clients, get useful advice on Online Finance Solution. The return rate from private banking investments generally remains in the range between 7% and 13% and in rare cases 30% too. This is feasible because, the extensive resources, wealthy clients can get elite access to investment vehicles such as top-performing hedge funds, through their affiliation with the bank. The client also receives professional advice from a top-notch business and financial professional on the best investment options providing a high rate of return.