HNWI - such a four-letter abbreviation refers to persons who may become customers of private banks. It comes from the English phrase "high-net wealth individuals" and means people with a significant level of wealth. It is with them in mind that the private banking institution was developed. What does it stand out and who are its customers?
It was the end of the 18th century. The industrial revolution began in Europe. Inhabitants of constantly developing cities were engaged in business activity. More manufacturing and service companies were established, trade with overseas colonies flourished. In other words, people started to get rich. Even during the Renaissance, bankers noticed that the emerging new financial elite would join the group of their clients. This is what happened, and the eighteenth century did not look different in this respect. At that time, however, the aristocrats in Great Britain began to demand that - like the first banks in history - financial institutions be created again, specializing only in serving the most affluent, but also exclusively noble-born. This is how private banking in the modern sense of the word came into being. Currently, private banking services are part of the offer of international financial institutions, such as Deutsche Bank, dedicated to the most affluent customers. Even in the 19th century Private Banks (as their English name sounds) opened up to business people who made fortune in the times of liberal capitalism. Later, new professional groups started to join the group of private banking clients. Currently, Private Banking services are used by private entrepreneurs as well as middle and senior managers, pensioners, liberal professions, artists and sportsmen.
HNWI or actually who?
- Private banking services may be used by persons holding assets of a certain value;
- For a private bank, in addition to this first criterion, the investment attractiveness of a potential client is also important.
Although private banks from 1817 and 2017 differ greatly, they still have a common feature - they provide financial services of an elite nature, although nowadays they are more accessible. Private Banks clients are said to be HNWI, i.e. very wealthy people. But what does this mean? For each private bank, the main criterion in classifying a potential customer as a HNWI is the assets it owns. What is the amount in question? This already depends on the bank's internal arrangements, but it is customary to assume that it is a minimum of one million dollars, euros, pounds or zlotys in the account. Private banks do not adhere rigidly to this criterion. Equally important is the investment potential of the future customer, as Private Banking institutions actively multiply the funds held by their customers.
- The scope of services offered by Private Banking is each time selected in terms of individual customer expectations;
- A personal advisor is responsible for the service of each client.
A private bank is referred to as a bank without borders and this has a double meaning. First of all, its services can be used virtually anywhere in the world, and the quality and duration of service are always at the highest level. Secondly, this form of financial activity is of an individual nature. This means that in many respects there are no limitations in the choice of services that a private bank can provide for the client. Their catalogue is open, so the offer is tailor-made for everyone. Apart from day-to-day service of personal and corporate finance, Private Bank can provide legal and insurance advice, and above all - deal with management of client's assets and increasing their value.
This is done on the basis of an investment strategy, the assumptions of which are consulted with the service recipient and take into account his personal preferences. Private banking is also a number of additional services that cannot be used by "ordinary" bank customers. These include booking airline tickets or concerts, access to VIP lounges at airports, or participation in closed special events organized by the bank. A personal advisor is responsible for all contacts between clients and private banks. He is a highly qualified specialist, dealing with both current financial transactions and investment issues, which is a real symbol of private banking.