Entrepreneurs, business owner managers, and families all look to Kleinwort Hambros’ banking experts for timely advice on managing and passing on their wealth.
Several centuries spent discretely looking after people’s money gives Kleinwort Hambros unique experience on the management of wealth. Relationships with its clients are strong and long lasting.
“Clients must feel well looked after,” said Rebecca Constable, director, private banking at Kleinwort Hambros. “For our clients, private banking is all about having a personal relationship with someone you trust and who will be with you for the long term.”
Kleinwort Hambros offers wealth management, banking, lending, financial planning and a number of other specialised services. Broadly speaking, the bank has three main types of client: entrepreneurs and owner managers of private businesses, senior executives and board members of large and multinational companies, and families focused on inter-generational wealth management.
“Our clients often embrace more than one or all of these groups,” said Paul Kearney, managing director at Kleinwort Hambros. “And all three groups are very well represented in the Thames Valley and Solent region.”
Clear focus after merger
Kleinwort Hambros is focusing on expanding its regional base as it marks one year from the 2017 legal completion of a merger announced in 2016. Kleinwort Benson, in business since 1786, and Hambros, which began in 1839, merged under the ownership of Societe Generale.
The global Societe Generale group has 150,000 employees based at 67 locations in 31 countries. In the UK, it has around 900 employees looking after £17 billion of assets under management. As well as Newbury, the bank has offices in London, Cambridge, Leeds and Edinburgh and operations in Jersey, Guernsey and Gibraltar.
Ensuring the merger was completed smoothly for clients and staff has been the priority. “The initial results from our latest customer satisfaction survey shows we have maintained client service levels over the past two years,” said Kearney.
The merger made commercial sense and puts the bank on a solid footing for the future. “The nature of banking has changed over the past 10 years, particularly the technology and regulatory landscape. Financial services businesses need to scale up and the merger created the perfect opportunity for us to have a larger presence in the private banking sector,” said Kearney.
But for Kleinwort Hambros, it’s not about being the biggest on the block. “Our clients are less concerned about our size than the service we offer them,” Kearney emphasised.
Constable added: “The merger was a very good cultural fit – similar employee attitudes, a complementary client base and complementary products. Bringing the two banks together enhances what we can offer in wealth management.”
At one time, the former Kleinwort Benson was one of Newbury’s largest employers with an administration and human resources office in nearby Speen. By coincidence, Hambros also had an office in the town, and these have now co-located.
“Newbury is an ideal location for the Thames Valley and the Solent,” said Constable. “The town is at a crossroads between the M4 and A34, giving us really good access to our clients across the region.”
The bank’s Newbury-based team acts as a ‘gateway’ for clients to access Kleinwort Hambros’ national and international network of private wealth specialists. Face-to-face client contact is at the heart of its relationships. “We don’t sit at our desks all day, that’s not our business model. We spend most of our time with our clients, helping to make their financial lives easier,” said Kearney.
Having an office covering the Thames Valley and Solent underlines the bank’s long-term commitment to the region. “We have always worked very closely with the local business community and local professional advisers,” noted Constable.
For local businesses, Kleinwort Hambros sees its role as giving advice to owners and senior executives whenever they need it during both corporate and personal lifecycles. For early-stage businesses, the bank usually provides support, ideas and networking contacts, rather than funding.
“We can introduce businesses to an ecosystem of professionals. Sometimes, when you are starting out you aren’t sure who to talk to. We have the local connections,” said Kearney.
One distinction in the Kleinwort Hambros service offering is its willingness to lend to entrepreneurs who aren’t extracting a full salary from their business because they want to keep reinvesting in its development. Kleinwort Hambros appreciates the liquidity pressures facing entrepreneurs during the build stage of any corporate enterprise. “We take the time to understand the longer-term earnings potential of these types of entrepreneurial business owners and will consider non-standard income to demonstrate affordability,” explained Kearney.
The well-established Kleinwort Hambros Entrepreneurs’ Forum offers a popular meeting point for business owners to share ideas and experiences. “We only have entrepreneurs in the room, from younger starters to more seasoned operators,” said Kearney. “It’s a great way to bring like-minded business people together.”
Time to think about your personal finances?
If there’s one area where business and personal interests converge with the greatest difficulty, it’s probably around money. At some stage, the thoughts of every business owner or company executive are likely to turn to their personal wealth, pension planning, succession planning, and extracting wealth from their business.
The question is, when is the best time to progress those thoughts into action? “Sometimes, we find business owners are so focused on the growth and success of their company that they don’t have time to look at financial planning for their family,” said Constable. “A trigger point for combining private and business advice is often when there is a key event in the life of their business, such as the potential for an exit or indeed a change in personal circumstances – the two can be related.”
Kearney added: “We’re not here to just provide products; we are here to offer smart solutions and the security of your financial affairs that you would expect from a large global company.”
Traditional service in the digital age
You might think a private bank steeped in history with a culture based on personal relationships might struggle to find a place for new technology. Kleinwort Hambros enthusiastically embraces digital banking tools. Its latest smartphone banking App is designed to support rather than replace the personal touch.
Interestingly, the bank finds that many of its tech-savvy entrepreneur clients prefer personal relationships when it comes to managing their money. “It’s a question of finding the right balance for each client. Some are happy with online self-service, others don’t even like email,” said Kearney.
Advising on personal philanthropy
When you’ve earned a lot, for many it’s natural to want to give something back, whether to charity, local communities or business owners supporting their employees, perhaps through apprenticeships. “Philanthropy is nothing new, but awareness is growing about its power to make a positive difference,” said Constable, who is also Kleinwort Hambros’ head of philanthropy. “You only have to look at the charitable foundations set up by the likes of Bill Gates and Warren Buffett and the Giving Pledge.”
Kleinwort Hambros works with Global Philanthropic, a leading organisation that advises donors on effective giving and helps charities with strategic fundraising. The bank also recognises the work of local charities such as the Berkshire Community Foundation, which raises money for, and makes grants to, local charities and community groups. The bank makes introductions to Global Philanthropic on behalf of its clients, so they can consider options on effective giving, and alongside this the bank can advise on how clients structure their giving, for example, by setting up a charitable foundation or a donor-advised investment fund.
Philanthropy is particularly relevant as corporate social responsibility (CSR) is high on the agenda of most companies, and employees increasingly expect to see tangible evidence of their employer’s involvement in local communities. “There is a real crossover between financial and philanthropic ambitions at both a personal and corporate level. This is another area where Kleinwort Hambros supports its clients and its employees.”
The team in Newbury currently has three senior bankers, Roger Plummer, Daniel Way and Jeremy Hill who work with Rebecca Constable, and two assistants, and they are looking to expand.