Credit Suisse Eyes Young, Rich Australians
Credit Suisse hopes that attracting the new internationally minded and technologically savvy generation of Australian investors will help the bank avoid the fate of UBS.
With the number of millionaires in Australia growing, Credit Suisse hopes that Australia's younger generation, which is more internationally minded and technologically savvy, will help grow its private banking business. Michael Marr, the bank's head of private banking in Australia, said it «had to respond» to the inter-generational wealth transfer happening in the country, Bloomberg reported.
The past three years has already seen Credit Suisse assets double at its private banking division in Australia. According to Marr, the rate of adoption of Credit Suisse's private banking app is the highest in Australia.
This change in behavior stands in stark contrast to the previous generation of investors, who were more used to managing their own money and preferred local property or Australian shares, which was among the reasons why rival UBS pulled its wealth management division out of the country in 2015.
Increasing Wealth
About $3 trillion is expected to be transferred from the older generation of Australians to their heirs in the next 20 years, the Australian Financial Review (AFR) reported, citing figures from the McCrindle consultancy. Apart from heirs to family wealth, the new rich in Australia includes many finance and fintech entrepreneurs, who made up one-third of entrants on the 2018 AFR Young Rich List.
According to the Credit Suisse Global Wealth Report 2018, the number of Australian US dollar millionaires is expected to rise by 41 per cent to 1,814,000 by 2023.
The same report found that Australia has the highest median wealth (US$191,453) globally, a position previously held by Switzerland. Australia's average wealth per adult currently stands at US$411,060, second only to Switzerland's US$530,240.
For Credit Suisse, there might be room to grow yet, as according to consultancy EY, only 20 percent of high net worth Australians have a private banker, compared to 70-80 percent in the U.S. and Europe.
