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The private banking business put the brakes on in 2022 due to the increase in rates

Date: June 18, 2024 Time: 12:32:31

The assets managed by private banking entities grew by 2.4% year-on-year in 2022, to 637,000 million euros, some six times less than the 17.1% increase registered the previous year, a “moderate” advance that Keep this year and next. This is one of the conclusions of the latest study on private and personal banking published by the DBK Sector Observatory of Informa, a subsidiary of Cesce, which adds that the “unfavorable” evolution of the equity and fixed income markets and the increase in interest rates influenced this business.

In general terms, private banking serves customers with assets in a minimum range of between 300,000 and 500,000 euros, while personal banking serves those who have assets below these amounts and commercial banking, the rest. Universal banks concentrated 74% of the business, while those specializing in private banking services managed 26%, according to Efe.

The sector has experienced several corporate movements in recent years, mainly the purchase of entities or business units, which has boosted the degree of concentration. One of the most recent and most important operations was the purchase of Credit Suisse by UBS, the outcome of which will have a great impact on the sector.

Personal banking assets fall

The uncertainty about the economic recovery, the instability of the financial markets and the possibility of new increases in interest rates will condition the evolution of the market in the short term, explains the report. However, the forecasts for the two-year period 2023-2024 point to a moderate acceleration in the growth rate of assets managed in private banking, in a context of growing efforts to attract customers by entities

As for the personal banking market, managed assets fell by 2.2% last year, due to the evolution of the markets described above and the rise in rates, and totaled 655,000 million euros. The number of clients, for its part, approached 6.2 million in 2022, the report adds.

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Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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