Global Finance names the best private banks in North America.
The last five years in US private banking have seen a 4.3% growth rate, according to market research firm IBISWorld, with a dynamic shaped by the pandemic. Unprecedented government stimulus packages, ultralow interest rates, increased liquidity and soaring markets maintained economic resilience through 2021. According to Capgemini’s World Wealth Report 2022, “North America retained its commanding lead for high net worth individual (HNWI) population growth (13.2%) and wealth (13.8%).” The report points out that the global population of HNWIs expanded by 1.7 million, or 7.8%, in 2021, with wealth swelling by 8%, or $6.4 trillion.
BEST PRIVATE BANK IN NORTH AMERICA
J.P. Morgan Private Bank
The tech sector is a leading engine of wealth growth; and this past year, J.P. Morgan (JPM), which also took the top spot last year, has been on a fintech tear. “Our recent fintech acquisitions and partnerships are catalysts in helping us deliver next generation digital, personalization and [environmental, social and governance] solutions to clients,” says Mary Callahan Erdoes, CEO of J.P. Morgan Asset and Wealth Management (AWM).
Recent acquisitions include 55ip, a fintech company with capabilities that enable financial advisers to deliver tax-smart investment strategies at scale; OpenInvest, a fintech company that helps financial professionals customize and report on values-based investments with more than 20 proprietary values-based causes; and Global Shares, a cloud-based provider of share management software with an expansive client base and nearly $200 billion in assets under administration. JPM also invested in talent, hiring 377 new analysts and 162 new client advisers and offering more than 280,000 hours of training.
BEST PRIVATE BANK FOR SUSTAINABLE INVESTING
According to Goldman Sachs’ Sustainability Report 2021, the bank is not quite halfway to its 10-year goal, set in 2019, of $750 billion in sustainable finance activity—with approximately $300 billion achieved so far, including $167 billion in climate transition and $50 billion in inclusive growth.
The report also notes that 1,800 transactions were reviewed in 2021 for environmental and social risk via the bank’s Sustainability Issuance Framework, created early last year, which outlines a program for green, social or sustainability issuances (including bonds, notes, certificates, warrants, deposits and certificates of deposit). Global environmental equity-focused strategies topped $1 billion in assets under supervision in 2021.
Abigail Pohlman, global head of the private wealth division’s Sustainable Solutions Group, told Barron’s in July that Goldman targets thematic investment opportunities in nine areas: five related to climate transition, including clean energy and sustainable transport; and four related to inclusive growth, including financial inclusion and access to health care.
BEST PRIVATE BANK DIGITAL SOLUTIONS FOR CLIENTS
Bank of America
The total technology budget at Bank of America (BofA) is $10.7 billion, with $3.6 billion annually dedicated to new initiatives. As of the second quarter of 2022, 86% of Private Bank clients are digitally active, up from 83% the prior year. That includes 70% of Private Bank clients who utilize the bank’s mobile app, up 4% year-over-year. Enhancements over the last year have included a broad set of capabilities in one app, a new mobile search bar made smarter with artificially intelligent virtual assistant Erica, in-app trading, streamlined rewards, e-signature capabilities and client surveys.
“The private bank takes a high-touch and high-tech approach,” says Sydney Ivey, chief operating officer at Bank of America Private Bank. “We are continually innovating to provide our clients with the best experience.”