Swiss private banking giant UBS is reportedly planning to bring the less-affluent segment of customers into a new category to help boost its profitability.
Bloomberg reported the move citing an internal memo written by UBS wealth management head in Europe, the Middle East and Africa Christine Novakovic.
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According to the memo, Swiss clients, with assets between $500,000 and $5m, will fall under a new bracket. The new coverage model stresses more on technology, limiting assistance from financial advisers.
Earlier, customers with a minimum of $2m in assets were placed in a different segment with access to a personal adviser.
In the memo, Novakovic defined customers with up to $5m as ‘one of our most important client groups’.
“Client data and surveys show that above the $5 million threshold, client needs begin to change,” Bloomberg quoted him as saying in the statement.
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By GlobalDataUBS’ rival Credit Suisse is also setting up a new unit for the least rich.
The move highlights that wealth managers are providing increasing importance on the less affluent customers.
Earlier this month, UBS predicted a rough time in investment ahead. It noted that 79% of investors foresee a period of higher volatility next year. The figure is 84% in Switzerland.
Also, 55% of them predicted a decline in the markets before 2020.
