Interview with DekaBank - Statement on the development of the market and support for consultants

Interview mit the Deka bank

Aachen, March 2017 – Due to the digitalisation and the imminent expansion of MiFID, the financial market is once again facing major innovation challenges.

"For investors in private banking, the main priority is capital preservation. In private banking, most investors have a fundamentally open attitude to the securities business. However, competition among this target group is very pronounced and the savings banks must therefore offer investors clear added value in order to do business," says Baumert.

DekaBank takes many paths in order to provide optimum support for the advisors of savings banks in these challenges. "As Deka Private Banking, we focus on three success factors in advisory services. On the one hand, we offer the consultants an ongoing qualification in the relevant specialist topics through an appropriate training concept. For the advisory process, we support the advisor with services that he can use directly for investment advice. This includes, for example, the creation of individual investment strategies or portfolio analyses.

And of course an attractive product range is also part of it. We fill these with our own and external solutions and reflect on a "best-in-class" approach. The savings bank advisor should thus have a competitive offering at his disposal that meets the needs of his customers very well," said Baumert.

For software support, DekaBank relies on aixigo for its solutions. The Aachen-based software company developed a portfolio optimisation programme specially programmed for DekaBank.

"Investors and advisors must rethink their asset class allocation, driven by the capital market environment. The aixigo Portfolio Optimisation is the ideal tool for us to show very transparently which asset class distribution is suitable for the customer and which return/ risk situation is associated with it. The whole thing is determined individually for the customer and is therefore perfectly suited to the special expectations of the customer. With the results paper, the consultant can also explain the background of the allocation to the customer in a target-group-specific way. We also see the topic of digitalisation as an increasingly important address channel. However, the topic is still very much present in the retail business among the offers available today. Private banking is certainly still in its infancy here. The right connection between highly qualified consulting and digitalisation still has to develop sustainably," says Hopff.

The interview - conducted with Christian Neuenhaus, Head of Marketing and Communication, aixigo

Neuenhaus: Central bank policy continues to keep interest rates virtually at zero. How did this policy affect your fund business in 2016?

Baumert: For investors in private banking, the main focus is on capital preservation. When it comes to real capital preservation, i.e. taking inflation and taxes into account, the inclusion of securities in the investment decision is an essential factor in achieving the objective. Many investors in this segment trust the fund and see it as a good opportunity to generate the necessary returns. We therefore certainly had a tailwind from the low interest rate level.

Neuenhaus: Do the local savings banks experience an active demand for investment opportunities in funds, or is it rather an active and tedious "fetch business"?

Baumert: In private banking, most investors have a fundamentally open attitude to the securities business. However, competition is very intense among this target group and the savings banks must therefore offer the investor clear added value in order to do business.

Neuenhaus: Psychological experience shows that it is easier for most people to save a relatively constant amount on a regular basis. Are savings plans or "one-off investments" the focus of the transactions?

Hopff: When we support savings banks in developing investment strategies for customers, we can already see that the core investments are made as one-off investments. But it is precisely when it comes to supplementary investments or building up the equity quota that gradual access via savings plans is a tried and tested means. This also helps when investors have uncertainties about the further development of the capital markets. In this way, the customer can level exchange rate fluctuations via the average price effect. By the way, this also applies to a step-by-step investment in the one-time investment.

Neuenhaus: The savings banks are facing fierce competition in the private banking segment. What concrete support do you give the savings bank advisors in advising this customer group?

Baumert: As Deka Private Banking, we focus on three success factors in advisory services. On the one hand, we offer the consultants ongoing qualification in the relevant specialist topics through an appropriate specialist training concept. For the advisory process, we support the advisor with services that he can use directly for investment advice. This includes, for example, the creation of individual investment strategies or portfolio analyses. And of course an attractive product range is also part of it. We fill these with our own and external solutions and reflect on a "best-in-class" approach. The savings bank advisor should thus have a competitive offering at his disposal that meets the needs of his customers very well.

Neuenhaus: What role does software support play in consulting?

Hopff: Today it is important to use the possibilities of technology in order to quickly generate knowledge gains for the customer. Those who use IT for many things in their private lives today want to feel this zeitgeist in their consultants as well.

Neuenhaus: What added value does aixigo portfolio optimisation provide "your" consultants? Especially with regard to the consulting process and traceability for consultant and customer?

Hopff: Investors and advisors must rethink their asset class allocation, driven by the capital market environment. For us, aixigo portfolio optimisation is the ideal tool to show very transparently which asset class distribution is suitable for the client and which return/ risk situation is associated with it. The whole thing is determined individually for the customer and is therefore perfectly suited to the special expectations of the customer. With the results paper, the consultant can also explain the background of the allocation to the customer in a target-group-specific way.

Neuenhaus: We experience again and again that high-quality reporting at the end of a consultation can be the last kick for the customer's decision. How do you experience this in sales?

Baumert: That's the way we see it and it also corresponds to the feedback from the consultants. The decisive factor is always to have a format that meets the customer's language but also does not have to shy away from competition in private banking.

Neuenhaus: Looking at the number of users, the tool is widely used. Is there concrete feedback from consultants who use portfolio optimisation?

Hopff: Essentially, the consultants are enthusiastic about the simple operation, the comprehensible logic and the professional output. In this way, the advisor can provide the client with clarity and transparency regarding the appropriate asset class structure. The high number of users also shows that the lack of integration into the OSPlus system of the savings banks does not detract from their attractiveness.

Neuenhaus: Do you expect fund business to grow in 2017? What are your expectations?

Baumert: We believe that in the current year, too, investors will have to include securities in their portfolios in order to preserve real capital. Funds are a good choice because they can open up certain market segments simply and well diversified for the investor. We therefore expect business to grow.

Neuenhaus: How do you currently approach the topic of digitalisation? From our point of view, further potential can be leveraged through this sales channel. Especially in order to transport an even higher attractiveness and to arouse first incentives for your business.

Hopff: We also see the topic of digitalisation as an increasingly important address channel. However, the topic is still very much present in the retail business among the offers available today. Private banking is certainly still in its infancy here. The right link between highly qualified consulting and digitalisation has yet to develop sustainably.

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