At a media briefing in Sydney yesterday, when asked if advisers who don’t meet FASEA standards would have a place in private banking, NAB Private customer executive Jason Murray said that private banking would not be a backup career for advisers that leave the industry.
“We are not a cozy place for people that didn’t cut it in advising, our standards are probably higher given this is a regulated bank,” he said.
Mr Murray was keen to stress that NAB Private does not provide any financial advice.
“If people come looking for advice we send them on to third parties. But if they want to and can manage it themselves then we will help them,” he said.
Mr Murray said that the advisers that were in the industry to earn money were not the ones that belonged with NAB Private.
“The DNA of an adviser can be anywhere from one extreme to another. One being ‘advice is a really good business because if I can get good funds under management I can earn some pretty decent commission for me’. That sort of adviser has no place in private banking,” he said.
Mr Murray said that private bankers at NAB were not advisers and were not remunerated through commission, nor products or sales but rather customer service and satisfaction.
Advisers who put the customer first and are genuinely passionate would probably do well in private banking, said Mr Murray referring to the wider private banking industry.
“You’re either a good adviser and you’re going to stay in advice. If they are leaving advice, why are they leaving advice? Possibly because they are a bad adviser and possibly not going to cut it in private banking either,” he said.
Mr Murray was keen to stress that NAB Private does not provide any financial advice and if people came looking for advice he said they sent them to a third party.
“If people come looking for advice we send them on to people like JB Weir. But if they want to and can manage it themselves then we will help them,” he said.
Private banking is one of its fastest growing businesses for NAB as the country continues to see a rise in the number of high-net-worth individuals.
Mr Murray said that private banking was meeting the needs of that growing market.
“We are one of the fastest growing parts of the bank. Private banking is a key growth area for the bank, not surprisingly given the stats,” he said.
The statistics provided by NAB found that there were over 435,000 high-net-worth individuals in Australia who combined were responsible for $1,720 billion in investible assets.
A high-net-worth individual was defined as having over $1 million in investible assets. Of those individuals, only 7 per cent had a private banker.
Mr Murray said that Australia was one of the wealthiest countries in the world and the high-net-worth individuals only had room to grow.
“Per capita, Australia is one of the wealthiest countries in the world. We are going through the biggest inter-generational wealth transfer in this country’s history and the high-net-wealth segment of the economy is the fastest growing in the country,” he said.
Mr Murray said that banking, like a lot of industries, is undergoing a major transformation.
“There is a real shake up of the industry going on at the moment. I think we will enter an era, as exists in other countries around the world, of a much greater predominance of advice for high-net-wealth individuals and for those that want to do it [themselves], it will be a more structured portfolios of diversified assets,” he said.
Sounds like Private Banking is some kind of altruistic pursuit being followed by the purist individuals in the industry. Private Bankers are not giving advice, they are shaping and fulfilling needs into NAB products – simple as that. I don’t think you would ever find a private banker say.. oh dear, we can’t help you with that Mr and Mrs Rich, you better go see Macquarie or UBS…. laughable.
> be an Adviser
> complain how unfair/unfounded the recent criticism of the industry has been
> “it’s not all advisers, just a few bad apples. You can’t tar the whole industry with the same brush!”
> *private banking executive offers more criticism*
> “aw nah but all those Private Bankers are evil! No qualifications, flog products, only in it for the money!”
> continue to sit in your glass houses next to a pile of stones ready to throw
> everything is fine. everything is fine.
PalmTree – what issues do you see and what issue do you believe advisers see that, in your eyes, are not issues?
– be a Bank (or AMP) Executive
– send your minions to the RC to answer for your crimes
– get your lawyers to negotiate your ASIC fines
– cheat clients and blame Advisers for it
– threaten the jobs of Advisers if they don’t meet the bank’s product budget
– empower an ex Journalist (who knows absolutely nothing and says everything is too granular to answer) to represent you in the FSC.
– say “sorry” a lot but not really mean that – just embarrassed you were found out
– Business as usual shortly
What a load of codswollop – supposedly and I say that very supposedly private bank advisers don’t give advice – we all know they do and ASIC will crack down one day. Goes to prove banks know very little about advice
Banks & ASIC. The relationship is very similar to myself paying a bribe to carry out business in a foreign country or it’s like me paying a Toll on the way to work. It’s just a cost of working. Only problem is everyone else (advisers) are the ones paying the penalty by being buried in red tape.
One of the worst articles I’ve ever read in IFA, poor staff who work for him, poor clients and poor shareholders as well, I know advisers who refer business into NAB Private they must be very disappointed.
What a joke considering my following point. Clearly this company is rotten to the core. To quote NAB’s CEO. “(what happened at the RC) sounds really serious but it’s not about fraud- it concerns potential breaches of the corporations act” it was “very clear” bank employees had not committed crimes.
As an adviser buried deep in red tape and compliance following the corporation law this statement makes me vomit. FDS, Best interest, Opt in might be optional and compliance with Corps Act might be optional for NAB staff and they have the bucks to pay ASIC…but not a serious crime? I’d like a few NAB advisers to tell that to NAB auditors next time they meet.
Private Bankers push product – loans, IPOs or hybrid issues they’re underwriting, structured products. They will never offer an investment product or loan of another product issuer. They don’t need to disclose the underwriting fees or commissions because the clients are “wholesale investors”.
Look at the new “private wealth” firms that have come from Private Bank (NAB, JBWere, BT, Macquarie, UBS Wealth Management) backgrounds, over the last few years…I’ve seen some examples of the advice given, it’s terrible…They only cater to ‘wholesale/sophisticated investors’ and get away with the same tricks they used to at the Private Banks. You should write an article about these clowns moving into the advice space…
How dare he damage any more the advisors reputation it is because of the W…. Bankers that we even had the RC, and frankly the reverse applies, I have employed many many bank advisors over the years, and every single one of them could not cut the mustard, if the role is a 10 part process for example! in there little world the advisor only does about 4 of the 10 at best, he is kidding himself, he thinks an advisor would want to work there, no wonder they are riddled with EU’s and as I said the whole reason for the RC, so out of touch with reality frankly, it is scary.
Sorry mate, it’s also no place for bank management who knew of or part of the mess being uncovered by the RC. Your colours show by directing your comments to planners.
So what qualifications does it take to be a Private Banker?
To complete a Masters of Being A Goose
You need to do a in house credit course. That is it. These private bankers, most come from the retail bank, the best sellers of product end up there. He says it, we dont offer advice just facilitate. Facilitate meaning hiding behind the SI definition to flog product to all and sundry. Ask Murray what the bonus structure for the private bankers are based on. Its people like this soon to be burnt out nab exec that divide the industry for thier own benefit, the only type of people that need to do that are those trying to deflect from thier own poor performance.
So predictable, and way too soon. As the banks exit wealth management en masse, leaving their wreckage behind, the ‘remnants’ will pontificate from the sidelines in a pathetic attempt to set themselves apart and reinvent history. Sorry, putting ‘Private’ before your business name doesn’t the change the culture, not doesn’t it entitle NAB to judge advisers or other business models. Come back in a decade (which is about how long it will take the rest of us to clean up your mess) and maybe we’ll care about your world view. Until then, spare us the PR reboot and just look after your clients.
What a ridiculous comment – as a former “private banker” my job was to sell investment loans against the “toorak” type of property then call in the so called planner who would place the funds in Bank aligned managed funds. The planner would earn over $400k pa in the easiest to get commissions and still complain about the unnecessary paperwork. Really you would only work as a PB planner because you don’t have the care and patiince factor and satisfaction gained from genuinely helping people over the longer term.
just another wanker banker that wants to load up their customers up with debt
OUR STANDARDS ARE PROBABLY HIGHER GIVEN WE ARE A REGULATED BANK
here we go is this the tune they will be singing sorry but the RC has blown that old theory of advice from a bank is safer because we are regulated. I agree EVERYONE in the industry should be held to these education standards, get rid of the clowns, and they are not just sitting in the advice chair.
What an absolute disgrace. So now we have the bottom line “You’re either a good adviser and you’re going to stay in advice” or your a BAD adviser because you chose to exit the Industry. Jason I am offended by your article. After 50 years in my Industry and priding myself on providing excellent advice to our clients. I may consider exiting the Industry but I do not view myself as a BAD adviser nor would any of my clients have this view. Time to make a public apology Jason.
Wow, that’s a bit rich coming from a banker. I have had a number of Private Bankers, the ‘service’ has been poor, and they’re constantly looking to push product – ‘wholesale investment opportunities’, loans, etc. I’ve had a few as they all move on after a few years. Private Bankers really do operate like the ‘bad advisers’ Murray is referring to.
WOW The Pot calling the Kettle Black LOL. Same old B.S from the banks.
I’ve been doing this for 20 years and have held various roles from paraplaner to senior executive and this type of person is the reason I won’t deal in the private bank space
ALL Bank Executives and Managers must be made to do FASEA – CEO’s and All.
All Super Fund Trustees & Managers, All Super Fund Trustees, CEO’s & Managers, All Industry Fund CEO’s and Managers, All Association FPA/AFA/AIOFP/FSC, etc CEO’s and Managers, All Government bodies ASIC/APRA/ATO CEO’s and Managers and lets not forget the politicians.
[b]ALL these parties have badly let down the Financial system and MUST be made to do FASEA.[/b]
I call complete BS on most of your comments. Your advisers are and always will be salesmen. You will sack your advisers if they don’t sell. End of story. You can’t give truthful, honest and GOOD advice with sales targets or kpi’s that align with the banks revenue goals. It won’t happen, can’t happen and never will happen unless you are willing to write off that advisers salary as a true servicing cost to your database. Put it in writing and clearly state there are no revenue, product or sales targets and then it might be believable. I doubt any bank will change this much.
Bizarre. I can’t imagine many advisers who plan to leave were thinking of becoming private bankers. You may as well have run a story saying “NASA no place for bad advisers leaving the industry, warns top astronaut at National Space Agency”.
Good comment, except this guy is no Astronaut! Qualified only as an Accountant. So the story should say “Some Clown said the Circus is a good place for Private Bankers”.