Jurgen Vanhoenacker, Lombard International’s executive director for sales and wealth structuring, Europe, talks to Christopher Copper-Ind on the company’s strategy, challenges and his vision for the future.
International Investment: What are the biggest challenges for the private client arena in 2018?
Jurgen Vanhoenacker: We feel that the biggest issue high net worth individuals (HNWI) face is the increasing internationalisation of wealth and the financial complexity this brings.
Clients who are only beginning to have business ventures in multiple jurisdictions, might have to dismantle their existing structures and replace them with solutions that support their international business or lifestyle. Asset managers on the other hand are faced with multi-jurisdictional reporting obligations that are laborious to handle.
Second, HNWIs have their wealth tied in many different asset classes which further complicates the management of the client portfolio.
Third, we see a tremendous amount of wealth passing down generations. For HNWIs the transfer of wealth is often multifaceted requiring a lot of expertise, especially in an international context. For example, transferring a big inheritance to the next generation might require flexible solutions that take into consideration age of the recipient and transferring of a family business to a suitable successor can sometimes be a lengthy process that requires expertise in many different fields.
II: How can Lombard International help intermediaries, e.g. private banks, meet their objectives in 2018?
JV: Having family members in multiple countries and an international business is quite common with today’s HNWI and having solutions that support multi-jurisdictional wealth planning is very important for these clients. They also consider having a wide investment universe at their disposal very essential not to mention flexible succession planning solutions.
Our expertise and solutions are tailored to the needs of the clients but we also align ourselves with our partners. Supporting our partners help their clients across many generations helps them to maintain long-term relationships. Our solutions also help simplify reporting.
II: How is the ever-changing regulatory backdrop affecting businesses?
JV: The regulation is certainly welcomed and we believe that in the long-term it will benefit the industry when it comes to customer protection and transparency. However, the professional community is struggling with big pieces of regulation that are costly to implement, and the time for implementation is often short. Small and mid-sized players are at risk of being consolidated with larger industry actors due to compliance issues.
Regulation is also an opportunity to innovate and it has made room for a number of new business ideas, especially around how to simplify the increasing administration.
II: What are Lombard International’s objectives for 2018?
JV: Our main objective is to keep up our track record. Last year was record-breaking year in terms of new premium and we of course want to maintain our success to be able to grow. We want to be a truly global player to be able to cater to the needs of our clients whose lifestyles extend to all corners of the world. We need to further develop our services and expertise to scale up the business and maintain profitability.
Our business model of open architecture is quite costly so it is important we find ways to simplify our processes and double down on efficiency.
II: What will be the key drivers of success for Lombard International in 2018?
JV: We are focusing on institutionalisation of our partner network. Our business has grown extensively and we need to create more strategic relationships that can serve Lombard International on a global level. We want to increase collaboration not only within the different branches of Lombard International but also find synergies within our partner network. For example, if we work with a private bank in Europe and that bank has operation in Asia we would want to see whether there are opportunities to collaborate on both continents.
We are also developing our solutions and services. We are waiting for regulatory approval for our new joint venture in Mexico with Akaan, a local asset management company and in Europe we are getting ready to launch a new high death benefit solution.
II: What plans does Lombard International have to increase its presence globally?
JV: Our aim is to finalise our offering in Latin America and strengthen our position in Asia, having established new offices in Hong Kong a little over a year ago. We are also looking out for acquisition opportunities, which would further strengthen our position in strategic regions.