According to a study released Thursday, July 8, by the consultant firm Scorpio Partnership, the assets of the high-net-worth exceed what is currently under management by private banks and wealth managers by some 58%, leaving approximately $10 trillion in realistically investable assets on the table.
The Global Private Banking KPI Benchmark study, now in its eighth incarnation, shows that while the assets under management (AUM) at banks rose by a median of 17% from losses last year, the key performance indicator (KPI) for profitability is off at a median of 35% from last year. Not only that, but net new money inflows are down at a median 60% as cost-to-income ratios continue to rise (78.2%, up from 72.4% last year). The study concludes that the health of the industry is "far from good," citing efficiency factors from the approximately 230 wealth management institutions surveyed as an indicator that the trend is static to down, although assets have grown substantially.
