Massimo Doris, CEO of Banca Mediolanum, the Italian parent company of the Spanish Banco Mediolanum, believes that the group still has great growth potential in both countries and does not believe that customers are concerned about the issue of the cost of products, as provided for by European regulations, if they achieve profitability.
What objective to attract customers and assets do you have for Spain?
This year, we will attract more than 10,000 customers. Exceeding one billion euros in total net assets acquired is a goal that we have, but it is not a question of having more family bankers [denominan así a sus asesores financieros] to attract more customers and more money. In a year like 2022, where the profitability of all assets suffered, it was more difficult to convince customers to transfer their money to us, but we achieved net deposits.
Do they have more growth potential in Spain than in Italy, where the market is more mature, for the group to continue growing?
In Italy we are very far from having reached maturity. But we still have very significant growth potential. This is why we will focus our next years on organic growth, both in Italy and in Spain. Traditional banks will continue to lose market share and the number of banks will decrease, although they will not disappear, but at some point this situation could occur. surprise from financial advice specialists.
In Italy they were pioneers with their advisory model through financial agents. But in Spain, the bank relies heavily on advice. Do you notice more competition now?
I’m not worried, because it’s one thing to give advice and another to do it well. If you look at what happened in Italy with investment funds over the last 20 years, there are about eight years of net repayments, like last year, with outflows of 22 billion. But if we look at the net deposits of the agent networks, which play the role of advisors, there is only one year of net repayments, in 2008. The capital outflows therefore came from traditional banks. And Mediolanum has not seen any outflow of money, even in 2008.
Because?
In 2022, stock markets have fallen by 20% and bond markets by 18%. Investors compared it to the profitability offered by the notes and did not understand the losses. If you are a bank employee and you have to deal with unhappy customers, you will tell them to sell the funds and buy the notes. But in the case of an advisor, it is highly likely that they made the fund recommendation and explained the difference in profitability they faced by selling at the worst time.
What do you think about the debate about the cost of consulting and eliminating failures?
90% of customers are not interested in the commission they pay. If you reach 10% profitability, you’re happy. If you lose it, no. Place. He doesn’t care if he pays half a point more or less, especially for individual customers. But for a financial advisor to be available to their clients and help them, it costs money. Because if you offer this service and the customer doesn’t pay anything, something is wrong with the model. If I sell you a Ferrari for 30,000 euros, it’s either second-hand or stolen, because that’s not possible.
How can the winds of change coming from Brussels affect financial agents?
In the United Kingdom, the rule prohibiting retrocessions in the sale of financial products has been applied since 2013. The cost of the products has fallen but not those paid by customers, because the retrocession has been transformed into an advisory fee, which in the United Kingdom United Kingdom, after 11 years of regulation, it is above 2%. So in Europe, if this ends up being implemented, the cost of the products will be lower, but what customers will pay will be the same. Or the service will have to be reduced.
Growth based on agents and without bank offices
Although the Mediolanum brand has been present in Spain since 2000, when it acquired the former Fibanc created by Carlos Tusquets, the entity has a history of more than forty years during which it has become the sixth bank by capitalization Italian stock market and. one of 113 supervised by the ECB, with more than 6,300 family bankers (as they call the financial agents on which they base their model of advice and distribution of financial products), 3,700 employees, nearly two million clients and 130,000 million euros in assets under management.
Founded by Ennio Doris in 1982, the success of the group lies in the fact that this growth has been achieved without having a single banking office and thanks to the trust established by the advisors with their clients, the basis of the entity’s model.
In Spain, they position themselves as the largest agency network, with 1,610 advisors, around 250,000 clients and around €12 billion in asset volume. But Massimo Doris, CEO of the group, believes that they still have a lot of potential, in a context where consulting is encouraged in Europe and not simple product placement.
In recent years, the group has bet on attracting private banking clients, both those with less assets, those with 500,000 to two million euros, as well as millionaires. For the first time, they created the figure of private banker (870 in Italy and 71 in Spain) and for the latter, that of fortune bankerwhere they already have 135 professionals in the transalpine country.
