–> This is a pre-event interview in the run-up to the Leaders in Finance Wealth Event on March 7, 2024.
Jeroen: Thanks, Sybelle Gielisse, for taking the time to speak to Leaders in Finance in the run-up to the Leaders in Finance – Future of Wealth event on the 7th of March this year. First of all, could you please introduce yourself?
Sybelle: Certainly! I am Sybelle Gielisse, 54 years old, Head of Wealth Management at Rabobank and I have a passion for private banking and investments. When I finished my studies, I had no idea that I would end up in the financial industry because my true passion lies in fostering growth and enabling high-performance teams. So, that was a bit unexpected. However, looking back, I can now say that within the financial industry, there is a significant focus on growth and cultivating high-performing teams. In the end, it all came together quite seamlessly.
Jeroen: If you look at wealth management, what would you say are large challenges?
Sybelle: In the wealth management industry, there are numerous challenges. First of all, you see that regulations are increasing. Besides this, from a client perspective, expectations are undergoing noticeable changes over time. Spotify, Bol.com are setting the bar for us. Additionally, there’s a rapid evolution of technology within financial services. Simultaneously, there’s a growing significance for clients to attain financial health, especially with reduced government support. One significant challenge lies in navigating the digitalization of the industry. Balancing the array of technological opportunities while maintaining a personal and relevant connection with clients is crucial. The question becomes how to cultivate a genuine, personal relationship within the digital environment. This, to me, is currently the most significant challenge in the wealth management industry.
Jeroen: I was intrigued when you brought up financial health. To what extent is it relevant for the wealthy people?
Sybelle: Well, I believe financial health is pertinent regardless of one’s position on the ladder. On one side, it is important to look at how we can support people to save and start building a buffer, and after having a sufficient savings buffer help clients to start investing. On the flip side, for those in a more financial wealthy position, the emphasis shifts to wealth protection as a means of sustaining financial health. So, I would say it is relevant for everyone, but with different dimensions.
Jeroen: Right. You already mentioned tech and digitalization. To what extent do you believe the wealth management and private banking industries are keeping pace with the latest technological developments?
Sybelle: What I’ve noticed is that a retail bank holds a unique advantage due to its retail banking status, especially when it also encompasses a private banking segment. This presents a significant benefit for us because we allocate substantial funds/budget to develop digital tools for retail clients. These tools include insights and functionalities such as assessing available space for additional pension contributions. Consequently, we can enhance our offerings through such activities.
Another example is AI. Currently, we have developed a system, in collaboration with Pega Systems, to communicate with clients in a more relevant manner. We are generating various offers for clients, and the machine autonomously decides which offer to present to each client, refining its decisions through its own algorithm. Occasionally, I receive offers or communications that I find particularly relevant, showcasing the machine’s learning capabilities. This, I believe, provides us with a significant advantage.
At the same time, when I consider FinTech’s, it’s evident that they don’t carry any legacy systems. This serves as an advantage for them. Conversely, it poses a challenge for us as we require substantial IT capacity just to maintain our operations. Thus, there’s a need to carefully balance the amount that can be invested in innovation or to free up budget for innovation.
So, I see a lot of potential to use technology to become more personal and relevant for our clients, and I believe this is a common perspective shared by many other financial insitutions. We all recognize the possibilities, especially in wealth management, as it presents a growth market. The key to success lies in being able to leverage technology intelligently. For instance, even in the high net worth segment, achieving true personalization and relevance is a challenge. While the relationship manager plays an important role, but they can’t have the overview of their entire portfolio of all their clients anytime. Hence, technology becomes essential in assisting them, making processes more efficient, and providing more time for client interactions. Technology can be employed at various levels, from recognizing patterns, generating alerts, automating tasks to using AI for summarizing information. It’s about understanding client concerns, sometimes even before they are explicitly expressed. The banking sector is witnessing rapid learning and development, and there’s immense potential for further growth and innovation.
So, I have to be honest about this; it is a shared reality for everyone. The real question is how you leverage data analytics, AI, and potentially blockchain. How do you incorporate automation and where do you introduce robotics?
As an example, we were discussing our client reporting for investments. This is quite heavy reading; it is detailed, and maybe also a bit boring. We are exploring to ask AI to make a summary for this monthly client reporting. It costs us maybe five minutes, and you have a wonderful story personalized to the clients expectations. So, if we then can just let someone say it in an inspiring way, how would you experience it then? The challenge lies in delivering the right message to the right client at the right time, with the appropriate tone of voice. This, I believe, is our mission. It’s a delicate balance, using technology to enhance our services while maintaining a personal touch in our relationships with private banking clients. This is an ongoing process.
Jeroen: Just before we proceed to the last two questions, I’m curious about wealth management at Rabobank. Could you elaborate on where it begins in terms of financials? When does one’s money become part of wealth management at Rabobank?
Sybelle: So, for private banking, clients typically start with a minimum of 500,000 euro in free investable cash, and for wealth management private office, it begins from 10 million onwards.
Jeroen: Now, moving on to the last two questions. One of them revolves around another crucial theme in both society and financial services, namely sustainable finance. I can imagine it is a substantial topic within your bank as well. Is that correct?
Sybelle: Absolutely. It is a major transition.
Jeroen: What does sustainability mean to you?
Sybelle: Currently, there are a couple of intriguing aspects we’re focusing on at Rabobank. Firstly, there’s a significant emphasis on adopting a “naturally green” approach in our investment portfolio. Despite regulatory constraints, we’ve committed to a single, distinct category—Article 8, which we refer to as “naturally green.” This stands out from the common distinction between green and brown or light and dark green. We prioritize performance while maintaining a natural, sustainable environment, aligning with our values. In contrast to other major banks in the Netherlands offering two investment options (sustainable and non-sustainable), we have opted for a unified sustainable approach within Article 8, ensuring both returns and environmental consciousness. That’s one key focus area for us.
Another intriguing aspect is the potential for our investments to accelerate sustainability goals faster than the entire bank. This raises the question of whether it’s acceptable for the investment side to outpace other segments, such as business clients. There we say, “we are in a transition, and we are staying next to our client”. Despite the potential for faster progress, we’ve chosen to maintain a unified vision for the group.
And the other thing maybe more of an ethical discussion. For investments, you need to be in the right companies, having a long-term perspective. Because over time, those committed to sustainability are likely to emerge as the successful companies of tomorrow. Anticipating a turning point, we recognize the need to align with sustainable companies for optimal returns, something we can justify to the client.
However, we have observed that many clients do not express strong preferences yet. They just want to invest.
Jeroen: Well, I think the question is, of course, what will they do once you give them two, three, four, or five options? Will they still go for the highest return, or will they choose a more sustainable option? I don’t know.
Sybelle: They will choose the highest return because that is how investments work. But I think you can make your investments naturally green, like article eight. So why offer them another flavor if they don’t ask for it? If you just say, “You get the highest return,” then it is fine for them. That will maybe change over time.
Jeroen: A lot of responsibility with you guys then.
Sybelle: Exactly. And that’s also why I think you should take your responsibility. We can drive change with investments given the significant amount of money we have invested.
Jeroen: For my final question, considering you are joining the Future of Wealth Event on the 7th of March, are there particular things that you will be looking for at an event like this?
Sybelle: I believe the entire industry is recognizing the same challenges and opportunities. Private banking is undoubtedly a growth area, and that is not a secret. what I’m particularly interested in hearing are specific examples of how banks are effectively balancing the opportunities presented by technology on one hand and deepening relationships with clients, ensuring a truly personal touch in the digital world. I am eager to learn what other banks are doing to inspire and innovate in this regard.
Jeroen: Wonderful. We are very much looking forward to have you at the Leaders in Finance Future of Wealth event on the 7th of March. Thank you for your time, Sybelle Gielisse, Head of Wealth Management at Rabobank.
–> This is a pre-event interview in the run-up to the Leaders in Finance Wealth Event on March 7, 2024.