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.
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.
UBS’ 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.