A global study of wealth management firms shows the Swiss bank remains in top spot, with signs of further concentration of business among the top-25 players and an improvement in cost-income ratios for the largest firms.

UBS retains its status as the world’s largest wealth management house by assets, ahead of Bank of America Merrill Lynch in second spot and Morgan Stanley in third, according to a collection of 2015 figures by Scorpio Partnership, the consultancy.

The Zurich-listed lender had $1.737 trillion of assets, while BoA Merrill Lynch had $1.444 trillion, and Morgan Stanley had $1.439 trillion, the figures showed (some explanatory notes are below about categories and definitions).

Credit Suisse, Switzerland’s second-largest bank, had $687.3 billion of assets; Royal Bank of Canada had $620.9 billion, Citi had $508.5 billion; JP Morgan had $437 billion, the figures showed.

Other figures: Goldman Schs $369 billion; BNP Paribas ($357.3 billion); Deutsche Bank ($311.4 billion); Julius Baer ($297.5 billion); BMO Financial Group ($287 billion); HSBC ($261 billion); Pictet ($239.2 billion); Northern Trust ($227.3 billion); Wells Fargo ($225 billion); ABN AMRO ($217.4 billion); Santander ($204.8 billion); Safra Sarasin Group ($194.2 billion); China Merchants Bank ($192.9 billion); BNY Mellon ($191.8 billion); Credit Agricole ($165 billion); ICBC ($154.1 billion); Lombard Odier ($133.6 billion), and CIC ($133.3 billion).

Scorpio Partnership’s latest edition of the Global Private Banking Benchmark Report released today shows the industry being buffeted by economic headwinds – with some exceptions. The majority of private banking institutions experienced a notable slow down in AuM growth and a squeeze on operating margins. Among the factors affecting results has been volatile markets and clients hesitating to onboard business at levels previously experienced.

The top 25 managed $11.0 trillion of high net worth AuM in 2016 representing a 56.3 per cent market share, up from 55.9 per cent market share in 2014. Indeed, the average net new asset growth rate was up 33 per cent from the figures for 2014.

As a group, the top 25 names also experienced better efficiency ratios with a 75.1 per cent cost-income ratio which is five points better than the all industry average of 80 per cent. However, their overall AuM levels dropped slightly more than the industry at large. While market volatility is a factor, some of this has also been impacted by a number of leading firms undergoing restructures of their divisional reporting lines.

“Ultimately, the market leaders have focused aggressively on improving their cost-effectiveness in their operating models in order to weather the storm as best as possible,” said Sebastian Dovey, managing partner at Scorpio Partnership.

“In spite of the tough times currently, the industry still has a positive future. Our HNW client feedback analysis evidences strong client engagement ratings with their provider experience across the same time period. But private banks will now need to become much better informed on what to do next to generate the best outcomes for client experience from a new assets and growth perspective,” he added.

The report said 2014 figures had been restated to adjust for changing methods in financial reporting by private banks. In some cases they are not consistent with previous years’ press releases.

Notes on the figures:
Bank of America Merrill Lynch’s Global Wealth and Investment Management division AUM includes Merrill Lynch Global Wealth Management (MLGWM) and US Trust, Bank of America Private Wealth Management & Other. The firm reports total client balances of $2.456.8 trillion including $900.9 billion in AuM and $1.040.9 trillion of brokerage business for this division. Assets in custody of $113.2 billion are excluded and banking deposits of $260.9 billion and loans and leases of $140.9 billion for this client segment. Furthermore, MLGWM accounts for 81 per cent of client balances in 2015 ($1,985.3 trillion). US Trust & Other accounted for the remaining 19 per cent. 68.4 per cent of MLGWM client balances are $1mn+ accounts (source: Credit Suisse Financial Services Conference, 2014). The estimated AuM for Bank of America Merrill Lynch attributable to HNW clients is $1.444.8 trillion.

Morgan Stanley has total AuM of $1,985.0 trillion including deposits of $149.0 trillion. 78.4 pe4r cent of total AuM is attributable to the $1mn client segment (Morgan Stanley 2016 US Financials Conference). Morgan Stanley’s AUM was calculated to be $1,439.4 trillion for HNW client assets.

Citi’s AuM is for accounts over $1 million including Citi Private Bank assets (CPB targets clients with a net worth of $25mn) and Citi Personal Wealth Management assets (CPWM targets mass affluent clients).

JP Morgan’s AuM of $437.0 trillion only refers to assets actively managed on behalf of private banking clients and does not include brokerage and deposit assets. The addition of custody, brokerage administration and deposit accounts would give total private banking client assets of $1,050 trillion.

BMO Financial Group AuM refers to BMO Wealth Management division.

HSBC AuM figure relates to funds under management placed with HSBC Global Private Banking division that serves high-net-worth individuals and families. It excludes customers’ deposits of $88bn.

Wells Fargo’s Wealth Management division AuM includes client assets and deposits of $225.0 billion as at Q4 2015.