Private wealth management Dutch style

As the customer investments manager and one of three managing directors, Fried van 't Hof makes a significant contribution to the success of VPV. Tailor-made private wealth solutions and professional portfolio management attract customers to the quiet city of Gouda from the whole of the Netherlands, Luxembourg and Belgium.

As part of its professional portfolio management service, VPV invests clients' money in undervalued corporate equities. A team of twelve analysts continually selects appropriate companies from an investment universe with a focus on the Netherlands, the UK and a small number of other countries. Computers assist with the pre-selection by supplying analysis models. A network of specialists is also on hand to provide additional advice. This is what experts refer to as the "bottom-up investment process."

VPV achieves great success using this type of portfolio management. Its customers have on average benefited from a 17 percent increase in their investments in recent years. If they had invested in the comparable MSCI World Index, they would have only achieved around 9 percent growth.

The Dutch company's range of products is rounded off with a small fund portfolio. Some of the products already using "Dresdner" in their names are generating high yields and have been singled out by Standard & Poor's.

In the highly fragmented private wealth management market, VPV is a typical niche player. However, the term niche is somewhat misleading here. In this sector even UBS, the Swiss asset management giant, accounts for only four percent of the market share.

The market is expanding globally by around five percent each year, particularly in Asia and the Middle East. When compared on an international scale, however, Europe's share of wealth is still ahead of these regions, just behind the USA. The Global Wealth Report by the Boston Consulting Group forecasts a further rise in the concentration of global assets in Europe from 29.4 percent in 2004 to 35.7 in 2009.

The cake is huge. In a joint study, investment bank Merrill Lynch and Capgemini, a consultancy firm, have estimated that the assets of the wealthy with more than one million US dollars under management will grow to the almost unimaginable sum of 42 trillion dollars by 2009. By comparison, the growth domestic product or GDP, the value of goods and services produced, for all 25 EU member states was just under 14 trillion dollars in 2003.

Dresdner Bank wants a slice of the cake and believes that there are significant gains to be made in the Netherlands: Approximately 50,000 Dutch households hold assets worth more than one million US dollars, giving a combined potential investment of almost 139 billion dollars. According to forecasts by Datamonitor, 70,000 Dutch households will belong to this wealth bracket by 2010.

Van 't Hof knows that wealthy Dutch investors differ from their neighbors, for example in Germany: "In the Netherlands there is a marked equity culture, our tax system is simpler and the Dutch are more disposed to handing over their money to an expert for investment. In addition, wealthy Dutch investors have always been happy to consider investments across the globe, in order to increase their assets."

It is precisely this type of customer that Dresdner Bank wants to attract. VPV offers a successful example of a skilled and cautious approach. After all, the competition by many banks for wealthy private customers is fierce. Every aspect has to be right: good performance, solid consulting and absolute discretion are top priorities.

Careful handling with an established range of products and a fixed client base are therefore essential for success. Anton Simonet, Dresdner Bank's Head of Private Wealth Management, explains: "In our core markets we are building a European private bank. Nevertheless, independent regional brands are frequently retained or supplemented with the Dresdner Bank logo."

Dresdner Bank Luxembourg acts as the toehold for private wealth activities in Holland, Belgium, France and Italy. This close co-operation between VPV and Dresdner Bank is overseen by Simonet and Benedikt Buhl, managing director in Luxemburg, with a great deal of instinct.

Alexander van Ketwich Verschuur, managing director and also responsible for customer relationship management, explains: "We are at a point where it would be difficult for us to grow purely under our own steam. As part of Dresdner Bank and the Allianz Group, we can access larger mandates, acquire more institutional customers and develop additional sales regions and channels for our investment products. Today we see ourselves as the Dutch branch of Dresdner Private Wealth Management."

For the future, VPV is planning to open further offices in the Netherlands. Some of VPV's products and services could also be transferred to Dresdner Bank.

Respecting employees is just as important as the careful handling of customers. Ultimately, the employees account for a significant part of the company's success. The team at VPV has a very close relationship with the company. Many employees have been there since the very beginning. The company is streamlined and there are hardly any managers. Almost all employees work in customer relationship management or portfolio management.

Employees have been able to access Dresdner Bank's Intranet for more than six months now and have become well acquainted with the parent company, in part thanks to their attendance at regular meetings of the international Private Wealth Management team.

And they notice that customers appreciate the combination of a small, flexible private bank and the strength and international dimension of a global financial group. Customers are reassured by the feeling of security that this type of group conveys. Fried van 't Hof: "After all, investing money is a matter of trust."

This text is based on an article from the employee magazine "dresdner banker".

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