Mediobanca launches wealth management arm; Mediobanca Premier

Mediobanca launches a wealth management initiative to help wealthy Italian households. Anika Sidhika writes.

Mediobanca has unveiled Mediobanca Premier, a bank that focuses on wealth management for Italian households. 

The development of the wealth management division’s business is a primary target of the 2023–26 Strategic Plan “One Brand–One Culture,” which outlines this new effort as a fundamental part of the growth process initiated by the Mediobanca Group. 

Two of the group’s unique selling points are combined in Mediobanca Premier to produce value. 

First is the history that Mediobanca has accumulated in over seven decades of competing with corporates in the market. 

The bank has been the go-to financial partner for big and medium-sized Italian businesses since its founding in 1946. 

By facilitating the connection between private wealth and fresh investment opportunities, the bank has helped these businesses expand both nationally and globally while maintaining a sustainable and ethical banking practice. 

The second is the knowledge that CheBanca! has gathered over the course of its fifteen years in business. 

Founded as a native digital operator in 2008, the company has evolved and grown, and currently it boasts an innovative digital and multichannel platform along with a wealth management product offering built around a strict and customised strategy for advice. 

CheBanca! has effectively positioned itself as the preferred partner for Premier clients’ investment management, handling around €40bn ($43bn) in total financial assets (TFAs), due to this dynamic mix and its network of approximately 1,100 specialists serving across Italy. 

Mediobanca Premier vision 

In addition to creating a distinctive merged offering based on Mediobanca’s capital market and corporate & investment banking products, which will set it apart in the market, Mediobanca Premier desires to become the primary provider in the medium-high market segment. 

This will be accomplished by creating an advisory and wealth management/protection offering with asset management products. 

Mediobanca Premier and CIB will collaborate to extend and renew their product and service offerings with the objective to suit the fiscal requirements of consumers with rising demands. 

Beginning with the introduction of Mediobanca Premier, all CheBanca! channels will be rebranded.

Core of the 2023–2026 Strategic Plan 

Wealth management plays a crucial role to the “One Brand-One Culture” strategic plan for 2023–2026. 

The division of wealth management, which includes Mediobanca Private Banking in Italy and CMB in the Principality of Monaco, as well as the product factories that function under Mediobanca Asset Management (Mediobanca SGR in Italy, Polus Capital Management for illiquid credit, and RAM Active Investment for systematic Investor Relations equity funds), will see significant growth driven by Mediobanca Premier’s expansion. 

Group general manager Francesco Saverio Vinci will oversee the wealth management division toward becoming the second largest contributor in terms of sales and the top contributor in terms of fee income by 2026. 

The division will also have strong levels of profitability, which will assist the group as a whole. 

These are lofty targets supported by a business model that is unique in Italy in terms of the caliber, accountability, creativity, and value of the offering for customers. 

It also requires significant investments in technology, products, and distribution (with a 25% increase in the workforce to over 1,500 professionals). By offering better growth rates in TFAs (which will rise to €115bn ($125bn), at a CAGR of +11%, versus 8% market, €85bn of which is AUM), revenues (over €1bn), and profitability (RORWA up 110 bps to 4%), Mediobanca Premier is expected to be poised to surpass the system. 

The potential market will back these aims; Italian consumers are projected to have over €5,300bn ($5.763bn) in total financial wealth, of which 60% is currently unmanaged. According to the figures for 2023, the wealth of affluent Italian households is expected to increase by 5.3% nationally to reach €1,287bn ($1.399bn). 

Mediobanca Premier Value Option 

Utilising the skills of its around 1,100 professionals—equally divided between bankers and financial advisors—Mediobanca Premier will cover the entire nation from its 200 point of sale locations, which are formed of both branch and financial adviser offices. 

This will be made possible by the ongoing development of digital platforms, such as the advanced suite of advisory services, the internet and mobile banking channels and the progressive premier business platform for professionals and entrepreneurs, which offers a variety of operational features while streamlining advisory services, which are now more easily accessible via person and remotely. 

With this model, Mediobanca Premier will be able to build on the growth that CheBanca has provided so far. Since 2016, CheBanca has grown its TFAs by three times, from €14bn ($15bn) to approximately €40bn ($43bn), and its net profit has increased from €8m ($8.6m) to €65m ($70m). 

Furthermore, the company has outperformed the market average in terms of growth in assets under management (AUM/AUA CAGR +19% in the last four years, compared to 6% market), sales networks (CAGR +10%, versus 2% market), and productivity €3.3m ($3.5m) in TFAs NNM per advisor, versus €1.9m ($2m) in the market, with an average portfolio of €35m ($38m). 

In addition to revamping the product line, the use of a new brand that appeals to bankers and customers alike will spearhead a significant hiring drive aimed at growing the Mediobanca Premier sales network from 1,100 to 1,350 professionals by the conclusion of the 2023–2026 Strategic Plan. This will help achieve the goal of raising TFAs by 25% by the conclusion of the plan, from €39bn ($42bn) to €50bn ($54bn). 

Mediobanca Premier will be able to beat the market due to this expansion, as fees are forecast to climb substantially, and net profit is anticipated to double. 

Alluring framework for advisers and clients 

The brand name Mediobanca Premier embodies the spirit of this new endeavour, reflecting on the group’s experience in corporate and investment banking as well as its specialised talents. 

Mediobanca Premier clients will be able to take advantage of the exceptional financial services that have been the investment bank’s main focus since its founding (particularly advisory services for M&A transactions, as well as raising debt and risk capital) as a result to the close ties and continuous interaction with Mediobanca’s CIB division. 

Since 2016, Mediobanca’s Private Banking division for ultra high net worth individuals has effectively evaluated this integrative approach to private and investment banking, generating considerable value. 

Advisers and consultants who opt to join this initiative can expect a carefully curated portfolio of products that benefit from significant local and international collaborations, as well as a premier digital platform. 

Along with a full suite of welfare services, a comprehensive training programme that has earned certification, and advanced marketing and engagement tools to promote the development of both current and new clients, they will also receive a competitive compensation and incentive package. 

Alberto Nagel, Mediobanca CEO, stated: “Mediobanca Premier is a project with unique characteristics in Italy, on the back of the Group’s expertise in Corporate & Investment Banking and its strong attachment to the values of excellence and specialisation that have always been key components of Mediobanca’s DNA.  

Alberto Nagel, Mediobanca CEO

“We’re convinced that these, allied to the strengths of our people plus our rigorous and sustainable approach to banking, will drive growth for Mediobanca Premier and the Mediobanca Wealth Management division as a whole, which is one of the priority objectives of the Strategic Plan 2023-26 ‘One Brand-One Culture’.”

Gian Luca Sichel, CEO of Mediobanca Premier, added: “The launch of Mediobanca Premier is a key step in the development of our bank. The progress we’ve made in recent years, coupled with the work we have done in terms of consolidating our management team, will enable us to face this new challenge with a strong foundation and determination.

“Today, we are able to combine the solidity and excellence that have always distinguished the Mediobanca brand with the capabilities and innovation in wealth management in which we have continually invested over the years with CheBanca!. With Mediobanca Premier we are ready and motivated to become key players in the development of the wealth management industry in Italy.”