Bank of the West, a subsidiary of French bank BNP Paribas, is taking a bigger step into wealth management, announcing Wednesday the launch of its first office in New York and plans to hire more than 100 private client advisors and wealth financial advisors across the country over the next three years.
“Wealth management activity for all banks is a very important activity for two main reasons,” said Sofia Merlo, co-CEO of BNP Paribas Wealth Management. “This is a growing market, so in the banking system a growth market is very important. The second part, it’s an activity that’s not really using a lot of capital.”
Bank of the West Wealth Management Group, which is part of BNP Paribas’ global wealth management business, was formed in 2011 with $3.5 billion in assets and 6,000 clients. Now, the unit has $13.5 billion in assets, 32,000 clients and 270 advisors, said Pierre Ramadier, head of Bank of the West Wealth Management Group.
But Ramadier has plans to grow the business to $21 billion in assets by 2020, primarily by focusing on the footprint the firm already has in 23 states and 18 wealth management markets. While the firm is opening in New York, there are no plans to open in other places.
“We want to reinforce where we already have a significant presence,” he said.
That said, the New York office, which currently includes five advisors, is a significant milestone for the firm, Ramadier said.
“It’s a place where we can leverage the relationships with BNP Paribas,” he added. “We have a lot of clients who today bank with us in Europe or in Asia that might be able to move to the U.S.”
The firm intends to have a dedicated segment in New York for expatriates, and it will structure products and services around that niche. There are a lot of expatriates coming from such countries as Belgium, France and Italy, where BNP Paribas has a strong marketshare in retail banking and wealth management.
“A lot of these clients today already bank with us in those countries, so having this capacity in the U.S. is very, very significant,” Ramadier said.
Today, the wealth management group onboards 4,000 to 5,000 new clients per year, on average. Two-thirds of those come primarily from its partnership with the 500 Bank of the West branches, while about 35 percent come from its relationships with BNP Paribas’ business banking clients.
“Because we bank with these clients on their professional side, having a wealth management department is extremely helpful for them,” he said.
Ramadier also expects the growth to come by leveraging BNP Paribas’ capabilities, which include cash management services, commercial banking, investment banking, small business banking and corporate and institutional banking. BNP Paribas manages $440 billion in wealth management assets globally.
Bank of the West Wealth Management Group currently offers 150 investment advisory strategies from providers, including BlackRock, Fidelity, Envestnet, Russell and PIMCO. It also has the capabilities to provide separately managed accounts and unified managed accounts, as well as a customizable trust platform.