Market participants starting to work in the financial sector are faced with a new concept, Private banking. This is a premium personal banking service for wealthy individuals aimed at conducting operations with client funds. Thanks to Private Banking, the client’s financial condition multiplies. This service is similar to the management of private capital. It is not easy for clients of financial institutions to understand its nuances. As a rule, it is interpreted incorrectly and requires clarification.
Myth 1. Private banking emphasizes owner status
Many believe that individual banking services differ from the usual ones only by the level of comfort, the presence of personal managers and the prompt resolution of any issues. Experts agree only on the last point and partly on the second. The main task of the banking institution is to work on increasing the client's welfare. A portfolio consultant working as a personal assistant helps a lot in this situation.
Myth 2. Premium banking services are not for everyone
Not only big businessmen but also representatives of the middle class can afford a high level of comfort of servicing in a bank. To receive this service, you need a sufficient amount of funds that you are willing to invest or put on deposit. The amount of the deposit depends on the country and the bank. Investments will constantly work, experts remind. Financial institution VIP clients can use any financial instruments of the bank.
Myth 3. Private banking is similar to fiduciary management
Recall the feature of the trust management of the bank is that the management of the financial institution unilaterally decides when and in what to invest client funds. However, this statement is incorrect with respect to private banking. A personal manager assigned to every client helps them to create an investment strategy attracting a multitude of specialists, from investment experts to treasury employees. This allows the client to make an informed decision about a particular banking operation.
Myth 4. You need to have a good understanding of investments to get private banking
This statement is not true, experts emphasize. To obtain the privileges of banking services, a client only needs to maintain an average monthly balance using any products of the bank. Experts help to choose the most suitable of them, and then to form an investment portfolio. A VIP investor will be able to receive all the information about the dynamics of his assets, both remotely and personally.
Myth 5. Premium banking service holders have few privileges
According to experts, the scope of privileges for Private banking is quite diverse. Each bank has its own bonus package. As a rule, it includes insurance for traveling abroad, free access to the business halls of major airports, service support 24/7, access to private events and special offers, unlimited Wi-Fi abroad and even on board airplanes, online access to the latest news and analytical reviews, etc.
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