World wealth money management 2013 update press briefing nyc- version dec2013

Global Wealth 2013
Maintaining Momentum in a Complex World
Press briefing
New York, May 30, 2013 – Embargoed until 12:00pm EDT today

Welcome to BCG
Today's speakers will share highlights from our Global Wealth 2013
eserved.
Daniel Kessler
Partner
Bruce Holley
Senior Partner
Anna Zakrzewski
Principal
Brent Beardsley
Partner
Federico Burgoni
Partner
Federico Muxi
Partner
ng Group, Inc. All rights r
Global Leader of the
Wealth Management
Topic / Europe
BCGZ i h
Topic Expert for Wealth
Management and Private
Banking in the U.S.
BCGN Y k
Management
BCGZ i h
Global Leader of the
Asset and Wealth
Management Segment
of BCG's Financial
Institutions Practice
BCG Chicago
Asia-Pacific Leader of
the Asset and Wealth
Management Segment
of BCG's Financial
Institutions Practice
BCG Si
Management in Latin
America
BCGB Ai
3 by The Boston Consultin
BCG Zurich
+41 44 388 86 00
kessler.daniel
@bcg.com
BCG New York
+1 212 446 2800
holley.bruce
@bcg.com
BCG Zurich
+41 44 388 86 00
zakrzewski.anna
@bcg.com
+1 312 993 3300
beardsley.brent
@bcg.com
Singapore
+65 6429 2500
burgoni.federico
@bcg.com
BCG Buenos Aires
+54 11 4317 5900
muxi.federico
@bcg.com
Joining by video link
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Copyright © 2013
Thank you for joining us today
Note: This document contains information that goes beyond the contents of the report

This is our 13th edition of the Global Wealth report
2001 2002 2003 2004 2005 2006
2013
eserved.
Taking the Client's
Perspective
Searching for
Profitable Growth
Richer Prospects in
Wealth Management
Prospering in
Uncertain Times
Winning in a
Challenging Market
The Rich Return to
Richer Returns
2007 2008 2009 2010 2011 2012
Maintaining
Momentum in a
Tapping Human
Assets to Sustain
Growth
A Wealth of
Opportunities
in Turbulent
Times
Delivering on
the
Client Promise
Regaining Lost
Ground
Shaping a New
Tomorrow
The Battle to
Regain
Strength
Complex World
2
Copyright © 2013

Global Wealth 2013 - Maintaining Momentum in a Complex
World
The 2013 report contains
three key elements...
...and discusses the new wealth
management industry complexity
Global wealth-management industry has become
complex:
• Old world2 and new world3 moving at different
speeds
• Wealth diverse sets eserved.
managers grappling with of
problems (e.g. regulation, profitability)
Core challenges:
• Old world - how to make the most of the modest
growth mature ng Group, Inc. All rights r
1. Overview of Wealth Markets
2 Benchmarking1
1
2
expected in economies
• New world - how to capture a substantial share
of the the ongoing wealth creation
Imperatives for wealth managers:
• Perspective on the wealth management market
2. Wealth Manager 3. Imperatives for the Wealth Management Landscape
3
p g
in 2020
• Key actions to be taken today to be positioned
for success in the future
Diff t Different t t i strategies d and b i business d l models will ill b be i required d t
to
succeed in the old world and monetize growth in the new world
3
Copyright © 2013
1. Based on proprietary data 2. Japan, North America, Western Europe 3. Asia-Pacific (ex Japan), Eastern Europe, Latin America, Middle East and Africa
Note: This document contains information that goes beyond the contents of the report

Key takeaways of Global Wealth 2013
Complexity: Wealth managers have to deal with an increasingly complex industry – this complexity is
not only the reality today, but will continue going forward
Wealth markets: Wealth grew overall in 2012, driven by strong market performance – Asia-Pacific (ex
Japan) is expected to surpass North America in 2017 as the largest wealth market
eserved.
Growth drivers: New wealth creation will account for over 2/3 of total growth through 2017 – growth will
be driven by high savings rates and continued strong GDP growth in rapidly developing economies
Profits: Precrisis profits for wealth managers are out of reach for now and the future – profit margins
remain under pressure and the cost base is still high among most wealth managers
Future success: Ongoing adaptation of wealth managers to key trends will be necessary for success in
2020 – speed, flexibility and willingness to transform are crucial elements
4
Copyright © 2013

Global wealth-management industry has become complex
3 by The Boston Consulting Group, Inc. All rights reserved.
5
Copyright © 2013

Agenda for Global Wealth 2013 press briefing
eserved.
Market Sizing: A Rebound Year
Benchmarking: In Pursuit of Precrisis Performance
Wealth Management in 2020: A Call to Action
6
Copyright © 2013

Key insights: Development of wealth markets globally
1 • Global private wealth1 increased by 7.8% in 2012, reaching $135.5 trillion
Global
• Strong rebound of equity market as main growth driver in the old world2, while the new world3 wealth wealth
lth
Wealth
distribution
2
g q y g ,
creation was additionally driven by high savings (% of GDP)
• 39% of total global wealth was held by 1% of all households in 2012
• 10% 13 8 eserved.
Outlook
3
Total number of millionaire households globally increased by 10%, reaching 13.8 million
• Private wealth is expected to rise by 4.8% annually to reach $171 trillion in 2017
• Asia-Pacific ( ex Japan) and its new wealth will account for the bulk of global growth
Offshore
wealth
• Offshore wealth grew to $8.5 trillion in 2012 mainly due to strong market performance
• Cross-border business is projected to stagnate in the old world and to grow strongly in the new world
4
p ) g g
5 • Wealth continues to grow strongly in the new world, driven by strong economic growth & high saving rates
Selected
regional
deep • APAC (ex Japan) is projected to reach $48.1 trillion, overtaking North America in 2017
7
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dives
1. Includes life insurance and pension fund reserves; across the 63 markets considered in the BCG Global Wealth 2013 report 2. Japan, North America, Western Europe 3. Asia-Pacific (ex Japan),
Eastern Europe, Latin America, Middle East and Africa
Source: BCG Global Wealth Market-Sizing Database, 2013

1 Overall wealth
Global wealth growth accelerated to 7.8%, increasing total
wealth to $135.5T in 2012
39.9
40.2 43.3
Private financial wealth in $trillions
0.8 7.8
0 9 5 2
2010 2011
2012
33.7 34.0 35.8
2.3
2012
2.1
2011
1.8
2010
0.9 5.2
16.4 13.2
0.6 2.4
16.7 16.8 17.2
eserved.
North America
2010 2011 2012
Western Europe
Eastern Europe
2010 2011 2012
3.6
Japan
7.8
135.5
121.4 125.7
3.2 3.6 3.9
4.8
2012
4.4
2011
4.3
2010
28.0
21.7 24.6
9.7 10.5
3.7 9.1
13.1 13.8
8
A l h 2010 2011
Gl b l
2012
2010 2011 2012
Latin America
Middle East and Africa
2010 2011 2012
Asia-Pacific (ex Japan)
8
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Annual change (%)
Global
Note: Private financial wealth numbers for all years were converted to U.S. dollars at year-end 2012 exchange rates to exclude the effect of currency fluctuations. Percentage changes and global
totals of private financial wealth are based on complete (not rounded) numbers. Calculations for all years are based on the same methodology. Global wealth is measured by financial wealth across
all private households, including life insurance and pension fund reserves. Countries included in each region can be found in the report

1 Overall wealth
New world wealth growth more than double of old world
wealth growth in 2012
Key drivers in 2012 Growth of private wealth 2010-2012
$
135.5
121 4 125.7
Change
'11-'12
• Growth mainly driven by savings
as % of GDP
St th i I di d
trillions
eserved.
New world1
39.1
34.6 (29%)
(28%)
121.4
31.0
(26%)
12.9%
New
world1
• Strong GDP growth in India and
China stimulated wealth creation
• In addition, strong equity markets
supported growth
Old world2
96.4
(71%)
91.0
(72%)
90.3
(74%) 5.9%
Old
ld2
• Principal driver was strong
rebound of equity market
• Existing assets contributed far
more than s al ealth gro th
2010 2011 2012
world2 usual to wealth growth
• Supportive monetary policies and
economic clarity after elections
9
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1. Asia-Pacific (ex Japan), Eastern Europe, Latin America, Middle East and Africa 2. Japan, North America, Western Europe
Note: All numbers are rounded and may not sum to totals

1 Overall wealth
Wealth growth driven by newly created wealth in the new world
and strong performance of existing assets in the old world
Growth in 2012 Drivers
~x%
(~y%)
2012
(2011)
Ne l created ealth3
GDP growth
+10.1%
(+13.1%)
Newly wealth3
Savings rate
Equity performance
f
f
+9.0%
(+8.9%)
+12.9%
(-9.6%)
New world1 +12.9%
(+11.6%)
• Asia-Pacific (ex Japan)
• Eastern Europe
• Latin America
~2.5 $trillions3
eserved.
+
Global
private
financial
wealth
f +2.7%
Existing assets4 Bond performance
Cash performance
(+6.4%)
~0%
(~0%)
• Middle East and Africa
~4.5 $trillions
~1.9 $trillions5
+7.8%
(+3.6%)
~9.8 $trillions
GDP growth
Savings rate
f
+2.3%
(+2.7%)
3.7%
(+4.0%)
Newly created wealth3
Old world2 +5.9%
0 8%)
~1.4 $trillions3
Existing assets4
Equity performance
Bond performance
f
f
+12.7%
(-6.9%)
+1.4%
(+3.3%)
(+0.8%)
• North America
• Western Europe
• Japan
~5.3 $trillions
~3.9 $3 9 trillions5
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Cash performance ~0%
(~0%)
1. Asia-Pacific (ex Japan), Eastern Europe, Latin America, Middle East and Africa 2. Japan, North America, Western Europe 3. New private financial wealth, generated primarily through income
4. Growth in asset values 5. Estimates
Note: Growth rates are nominal, including GDP growth rates. Performance averages are weighted by GDP and reflect domestic developments. All numbers are rounded and may not sum to totals

2 Wealth distribution and millionaires
In 2012, 1% of all households represented 39% of global wealth
Global 2012 New world1 2012 Old world2 2012
13.8 3.6
CAGR '12-'17 CAGR '12-'17 CAGR '12-'17
6.9%
1,118
4.2%
39
19 8%
135
5.5%
16.7%
1,481
17.0%
96.4
5.0%
363.1
2.4%
15.5%
10.2
+9.2%
+8.0%
+17.3%
+15 4%
15.4%
+3.3%
+3.2%
1%
eserved.
19.8%
16.9% +4.6% 56.7% 17.7%
15.1%
+10.0%
+2.5%
39%
95.5%
31.0%
+3.3% 53.7%
27 2%
47.1%
82.0%
40.5%
+8.1%
7 3%
+2.1%
Households
(millions)
27.2%
Private wealth
($trillions)
13.7%
Private wealth
($trillions)
Households
(million)
Households
(millions)
8.2%
Private wealth
($trillions)
+3.7%
+7.3%
-2.1%
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x.x # millionaire HH (in millions) > 100m USD 5 - 100m USD 1 - 5m USD 0.1 - 1.0m USD 0 - 0.1m USD
Note: Private financial wealth numbers for all years were converted to U.S. dollars at year-end 2012 exchange rates to exclude the effect of currency fluctuations. All numbers are rounded and may
not sum to totals

In 2012, the number of millionaire households grew by 10%
Millionaire household development
(in thousands) Millionaire households in 2012
+10%
13,829
3 601
12,584
+1.24m Number of millionaire
households (thousands)
Proportion of millionaire
households by market (%)
eserved.
3,601 New world1
3,131 (26%)
(25%) +469k
Qatar
Switzerland
Kuwait
Hong Kong
Singapore3
USA
14.3%
11.6%
11.5%
9.4%
8.2%
4 9%
1. (1)
2. (3)
3. (2)
4. (4)
5. (5)
6 (7)
USA
Japan
China
UK
Switzerland
Canada
5'876
1'460
1'304
509
395
373
1. (1)
2. (2)
3. (3)
4. (4)
5. (5)
6 (6)
10,228 Old world2
9,453 (74%)
(75%)
+775k
Bahrain
Taiwan
UAE
Israel
Oman
4.9%
4.9%
4.0%
4.0%
3.8%
3.3%
6. 7. (6)
8. (9)
9. (8)
10. (10)
11. (11)
Germany
Taiwan
Italy
France
362
312
274
256
231
6. 7. (7)
8. (8)
9. (9)
10. (10)
11. (11)
2011 2012
Belgium
Canada
Japan
Netherlands
3.2%
2.8%
2.6%
2.6%
12. (12)
13. (13)
14. (14)
15. (16)
Hong Kong
Netherlands
Russia
Australia
India
191
180
178
164
12. (12)
13. (13)
14. (14)
15. (15)
( = Ranking in 2011
12
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) g
1. Asia-Pacific (ex Japan), Eastern Europe, Latin America, Middle East and Africa 2. Japan, North America, Western Europe 3. Singapore figures restated due to changes in the methodology
applied for the estimate of wealth held in equities and cash at the end of 2012
Note: UAE is United Arab Emirates. 2011 ranking is determined on the basis of year-end 2012 exchange rates to exclude the effect of currency fluctuations. All numbers are rounded and may not
sum to totals

In 2012, the number of UHNW households increased by 7%
Number of ultra-high-net-worth (UHNW)
households
UHNW households in 2012
(more than $100 million in private financial wealth)
+7%
12,093
11,321
+772 Number of UHNW
households
Proportion of UHNW
households by market
(per 100,000 households)
eserved.
4,285 New world1
3,870 (35%)
(34%) +415
Hong Kong
Switzerland
Austria
Qatar
Norway
Si
13
10
9
8
8
7
1. (1)
2. (2)
3. (3)
4. (4)
5. (5)
6 (6)
USA
UK
China
Germany
Canada
Ital
3016
1001
851
680
476
381
1. (1)
2. (2)
3. (3)
4. (4)
5. (5)
6 (6)
7,808 Old world2
(65%)
7,451
( 66%) +357
Singapore
Kuwait
Israel
Belgium
UK
7
4
4
4
4
6. 7. (7)
8. (8)
9. (10)
10. (9)
11. (12)
Italy
France
Turkey
Switzerland
Russia
371
357
339
328
323
6. 7. (7)
8. (9)
9. (8)
10. (11)
11. (12)
) New Zealand
2011 2012
Canada
Sweden
Denmark
UAE
4
3
3
3
12. (11)
13. (14)
14. (15)
15. (13)
Hong Kong
Austria
Brazil
Australia
Indonesia
314
236
231
221
12. (10)
13. (14)
14. (13)
15. (16)
( = Ranking in 2011
13
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) g
Note: UAE is United Arab Emirates. 2011 ranking is determined on the basis of year-end 2012 exchange rates to exclude the effect of currency fluctuations. All numbers are rounded and may not
sum to totals

3 Outlook
Wealth growing to $171T in 2017, driven by new world wealth
creation
Projected key drivers Growth of private wealth 2012-2017
$
CAGR
4.8% 171 '12-'17
• Wealth growth driven by high
savings rates and continued strong
GDP
trillions
New
64
eserved.
10.5%
New world1
(38%)
135
39
(29%)
world1 • High savings have strong effect on
wealth creation growth rate since
wealth stock still relatively low
compared to GDP
107
2.1% Old world2
96 (62%)
• Growth more dependent on
performance of existing wealth
Old (71%)
ld2
2012 2017
world2 • Moderate/constant GDP growth
and savings rates projected
14
Copyright © 2013
Note: All numbers are rounded and may not sum to totals

3 Outlook
Asia-Pacific (ex Japan) will account for bulk of global growth
through 2017...
Regional contribution to growth in global wealth 2012-2017 ($trillions)
trillions)
4.7
4.8
1.0 35.7
Growth ($40
30
New world1 contributes ~70% Old world2 contributes ~30%
~20%
eserved.
1.7
1.7
1.9
20.0
20
80%
New wealth
creation
accounts ng Group, Inc. All rights r
10
0
~for
~80% of total
growth
North
America
Western
Europe
Eastern
Europe
Middle East
and Africa
Latin
America
Asia-Pacific
(ex Japan)
Japan Global
Performance of old wealth3: 13% 43%
15
Copyright © 2013
New wealth creation4: 87% 57%
1. Asia-Pacific (ex Japan), Eastern Europe, Latin America, Middle East and Africa 2. Japan, North America, Western Europe 3. Growth in asset values, assuming moderate returns on assets
4. New private financial wealth, generated primarily through income
Note: All numbers are rounded and may not sum to totals. Private financial wealth numbers for all years were converted to U.S. dollars at year-end 2012 exchange rates to exclude the effect of
currency fluctuations. Performance of old wealth vs. new wealth creation splits are estimates

3 Outlook
...and will likely overtake North America by 2017 as largest
wealth region
Future regional private wealth 2012-2017 CAGR 2012-2017
O ll48%
Ranking of regions
R k2017 (2012/2007)
T t l ($t illi ) Overall 4.8%
11.4%
2 1%
Rank 2017 1 (3/4) Asia-Pacific (ex Japan)
N thA i
2 (1/1)
28.0
Total trillions)
48.1
48.0
eserved.
2.1%
2.5%
North America
Western Europe
3 (2/2)
43.3
40.6
35.8
18 2
Japan 1.1%
6.2%
4 (4/3)
5 (5/5) Middle East and Africa
6.5
4.8
5 9
18.2
17.2
8.3%
11.3%
Latin America
Eastern Europe
6 (6/6)
7 (7/7)
5.9
3.9
4.0
2.3 2017 2012
16
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New world1 Old world2
Note: Private financial wealth numbers for all years were converted to U.S. dollars at year-end 2012 exchange rates to exclude the effect of currency fluctuations. Calculations for all years are based
on the same methodology

3 Outlook
China is projected to become the 2nd wealthiest nation in 2017,
with India and Russia moving up in the ranking
15 largest wealth markets in 2017 ($trillions)
50
39
43
40
eserved.
+104%
30 28
7 8 7 8
17 18
14
5 6 4 5 4
5 5
20
10
+127%
+90%
4 3
2
0
2 3 2 3 2 3 2 3
3 3
1
(1/1)
U.S.
2
(3/5)
China
3
(2/2)
Japan
4
(5/4)
Germany
5
(4/3)
U.K.
6
(6/7)
France
7
(7/6)
Italy
8
(8/8)
Canada
9
(15/18)
India
10
(9/9)
Australia
11
(17/16)
Russia
12
(11/12)
Taiwan
13
(12/15)
South
Korea
14
(14/14)
Hong
Kong
15
(13/11)
Switzer-land
17
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Rank 2017 (2012/2007) 2012 2017
land
Note: 2007, 2012 and 2017 rankings are determined on the basis of year-end 2012 exchange rates to exclude the effect of currency fluctuations. All numbers are rounded and may not sum to totals

4 Offshore wealth
Offshore wealth in the new world is projected to grow in line
with onshore wealth in the new world...
Key drivers Growth of offshore wealth 2007-2017
$
• Especially HNW / UHNW looking for
geographical diversification
• Clients continue to seek high-quality
i d liti l t bilit (
CAGR
'12-'17
11.2
trillions
eserved.
New
world1
services and political stability no
tax avoidance motivation)
8.5
• Lack of sophisticated onshore
offerings lead to higher share of
7.5
wealth booked offshore (67%)
9.0%
4.9
7.3
Old
ld2
New world1
(57%)
3.6
(49%)
• Offshore WM industry under
pressure from tax authorities
• Offshore clients seeking for
economic stability world2 3.7
3.7 3.7
0 5%
world2 y
• Modest repatriation is going to be
offset by performance of existing
assets
0.5%
Old world
(33%)
2017
(43%)
2012
(51%)
2007
in % of total 6.5%
wealth
6.3% 6.6%
18
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Note: Offshore wealth, defined as assets booked in a country where the investor has no legal residence or tax domicile. All numbers are rounded and may not sum to totals

4 Offshore wealth
...while the share of offshore wealth in old world is on the
decline
CAGR
'07-'11
Regional mix of private wealth booked offshore 2007-2017
(by client domicile)
Wealth '17
($trillions)
CAGR
'12-'17
CAGR
'11-'12
Total
($trillions)
7.3 8.5 11.2 2.4%
10.6%
Overall
4%
11%
3%
9%
5% Eastern Europe
13%
11.2
0.5
6.1%
8.2%
5.7%
12.0%
eserved.
8.3%
3.7%
19%
23%
18%
20%
18%
Latin America
Middle East
and Africa
New
world1
1.5
2.1
7.3%
7.9%
9.2%
5.2%
5.2%
-4.0%
3%
35%
30%
1%
2%
32%
Asia-Pacific
(ex Japan)
Japan
Old
3.4
0.2
9.8%
-0.7%
11.3%
-2.5%
0.0%
-3.5%
24%
13%
2007
8%
2017
3 %
9%
2012
Western Europe
North America
world2
2.7
0.8
4.5%
-1.2%
0.4%
1.4%
19
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Note: Offshore wealth, defined as assets booked in a country where the investor has no legal residence or tax domicile. All numbers are rounded and may not sum to totals

4 Offshore wealth
MEA and Latin America have the highest offshore share
compared with other regions
E t E
Western Europe
Eastern Europe
13%
8% Japan
North America
2%
eserved.
Asia-Pacific
( ex Japan)
1%
Middle East
and Africa
Latin America
25%
p )
7%
low
offshore
share
33%
R i ithl hi ti t d h ff i h
high
offshore
share
20
Copyright © 2013
Regions with less sophisticated onshore offering show a
higher share of private wealth booked offshore
Note: Offshore wealth, defined as assets booked in a country where the investor has no legal residence or tax domicile

4 Offshore wealth
Most of the offshore assets flow to few key financial centers –
an overview
Channel
Islands2
Switzerland UK3 US Luxembourg Singapore Hong Kong
Size1 2012 3.5 T 30.0 T
(AuM USD)
1.4 T 3.9 T 0.6 T 1.2 T 2.1 T
eserved.
0.6 T 0.7 T
Of which off-shore
assets 2.2 T 1.1 T 0.9 T 0.6 T 0.8 T 0.4 T
Wealth
2% 20%
24%
structure
(2012)4
63%
37%
76%
82%
32%
80%
90%
10%
68%
98%
18%
21
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Offshore Onshore
1. On- and offshore assets booked in respective country (excl. life insurance and pensions) 2. Including Dublin on- and offshore 3. Excluding Channel Islands & Dublin on- and offshore wealth
4. Onshore wealth for Channel Islands and Luxembourg are estimates
Note: Offshore wealth, defined as assets booked in a country where the investor has no legal residence or tax domicile

Regional deep dives
3 by The Boston Consulting Group, Inc. All rights r
eserved.
22
Copyright © 2013

5 Regional deep dives – Asia-Pacific (ex Japan)
APAC (ex Japan) is projected to become the world's largest
wealth market in 2017, driven by strong economic growth
Wealth development in APAC (ex Japan)
(in $trillions) Looking at growth opportunities ahead
CAGR
'12-'17
Overall 11.4%
7.6%
• Wealth continues to grow strongly, driven by
strong economic growth and high saving
rates
15.7 28.0 48.1
3.8
eserved.
5.5% • Profitability is recovering, but still poor
4.1%
3 2%
relative to other markets. Institutions have
accepted this but expect high growth and
future potential
2.9
2.8
3.0
3.6
2 1
2.6
4.5
3.2%
4.7%
17.8%
• APAC wealth managers need to transform
their business models (institutionalizing,
industrializing, shift away from brokerage)
2.1
1.9 1.7 1.8 2.0
27.5
2.1 2.9
2.5
2.3
13.5
2.4 1 1
15.3% • Booking centers in HK and SG are
significant and continue to grow. They are
benefiting from rising Asian wealth, the fact that
Asians prefer local relationships and regulatory
i E
4.7
1.1
2012
2007
2017
Rest of APAC (ex Japan) South Korea Australia China
23
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Hong Kong Taiwan India pressure in Europe
Total wealth ($trillions)
Note: Data include life insurance and pension fund reserves. All numbers are rounded and may not sum to totals

5 Regional deep dives – Latin America
LatAm wealth market is growing strongly and becoming a
more competitive market
Wealth development in Latin America
CAGR
'12-'17
Overall 8.3%
• Wealth projected to grow a cross the region
by 8.3% annually, e.g.
– In Brazil especially, the wealth extremes of
very poor and very rich will grow strongly
2.5 3.9 5.9
1 1
9 1%
eserved.
• LatAm Wealth market is becoming a more
competitive market
• New entrants and increasing relevance of
regional LatAm players:
1.1
0.4
0.4
0.4
1 4
0.7
0 2
9.1%
7.6%
7.6%
– Asset managers (e.g. boutiques, hedge
funds, etc.) moving into WM space
– Family offices deepening their offerings
– Universal banks without a presence yet
developing specific WM 1.4
0.5 4.7%
2.3
0.2
0.3
0.3
1.0
1 4
0.2 0.2 0.1
0.6
6.8%
offering
• Increasing demand for sophisticated
product offerings:
– Decrease in interest rates put pressure on
wealth managers to continue generating
2017
1.4
0.9
2007 2012
Rest of LatAM Colombia Mexico
10.0%
24
Copyright © 2013
g g g
returns for clients
– Access to clients and distribution is not the
only key to success anymore
Argentina Chile Brazil

5 Regional deep dives – North America
North America is losing ground due to a high dependency on
the growth of existing assets
Wealth development in North America
CAGR
'12-'17
Overall 2.1% • Wealth projected to grow moderately by 2.1%
1.9%
annually
39.3 43.3 48.0
4.5
eserved.
• Growth predominately driven by growth of
existing assets via market performance
• Therefore, wealth managers will largely be
4.1
3.5
2.1% playing a “share stealing” game for existing
wealth in which both an institution’s starting
position and its ability to retain clients will be
crucial
43.5
39.2
35.9
• The more stabilized economic outlook in the
U.S. leads to a more positive market sentiment
2007 2012 2017
Canada USA
25
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Agenda
eserved.
26
Copyright © 2013

Key insights: Wealth manager's performance in a complex world
1 • Overall, wealth managers saw strong growth of AuM by 13%, with especially high growth rates in Asia-
AuM1 and
NNA2
Pacific (23%) and LatAm (18%), driven by NNA flows and exceptionally strong equity performance
• High growth rates in rapidly developing economies shows the importance of building a presence in the
emerging wealth markets, especially Asia-Pacific and Latin America
2 • ROA slightly decreased to an average of 81 bps in 2012, with pressure stemming from a decrease of
ROA3 and
Revenues
managed products penetration, which in 2012 was 21% below precrisis levels of 2007
• Widespread performance among best and worst wealth managers shows potential and need to work on
improved eserved.
return on assets
3 • Costs increased on average by 3%, which was less than revenue and AuM increases, indicating modest cost
Costs and
Efficiency
controls by wealth managers and a slight improvement of the cost-income ratio
• Cost management will remain critical for wealth managers as rising costs will hurt profitability, especially in
Pretax profit
margin
• Wealth managers posted slightly improved pretax profit margins; compared to precrisis years, they are
significantly down (-10 bps) through both lower returns on assets and a higher cost-income ratio
• 4
y
years with less well-performing equity markets
Pretax margins of top performers show that wealth managers with the right business model can be
successful in all regions
RM4
Effi i
• Front efficiency is increasing, as shown in higher CAL5 and revenues per RM from wealth managers
across most regions
5
27
Copyright © 2013
Efficiency g
• Front management is gaining importance for wealth managers to further increase front efficiency
1. Assets under Management 2. Net New Assets 3. Return on Assets 4. Relationship Manager 5. Client Assets and Liabilities
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities. Numbers are rounded
Source: BCG Wealth Manager Performance Database, 2012 and 2013

Profit margin of wealth managers increased on average by 2.7%
globally, driven by AuM growth and moderate cost increases
A t d +12.9%
f
Return on -4.1%
Assets under
management
• Strong equity performance
• Increased net new assets flow
• Strongest in emerging eserved.
f
assets2 (ROA)
Revenues
+4.8% Profit
Margin3
growth markets
• Declining return on assets
• Less favorable asset allocation
• Full price realization difficult
f Cost/income
ratio (C/I)
-2.5% +2.7%
• Good revenue increase
• Lower increase than AuM1 change
• Asia-Pacific increasing strongest
U d ti l t i
Cost
+3.1%
• Slight increase of cost base
• Costs over assets (COA) • Under proportional cost increase
• Improved efficiency
• Driven by higher AuM & modest cost
increases
• Non-front-related COA decreasing most x% change 2011 – 2012
28
Copyright © 2013
decreasing slightly
1. Assets under Management 2. Revenues divided by yearly average client assets and liabilities 3. Revenues less total costs from private banking, divided by average CAL
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities. Numbers are rounded. One participant from Asia excluded due to structural change of operations for costs

1 AuM and NNA
Strong AuM growth for wealth managers in most regions, driven
by both NNA increase and strong equity performance
AuM increase much stronger than in previous year ...
... driven by NNA increase and
and equity performance
2 2
-1.9
-2.8
9.4
9.6
Europe offshore1
Europe onshore
11 9
1.8
5.5
7.7
3.9
eserved.
4 9
9.0
2.2
18.0
22.7
Asia-Pacific
Latin America
N thA i b k
3.4
8.2
11.9
10.8
9.8
0.9
0.1
4.9
12 9
4.6
11.0
North American banks
North American brokers
Global
5.6
0.0
7 3
4.6
7.6
12.9
-5% 0% 5% 10% 15% 20% 25%
2010-2011
2011-2012
7.3
0% 5% 10% 15%
Net new assets
Performance2
Hi h th t i i k t h th
29
Copyright © 2013
High growth rates in emerging markets show the
importance of building a strong presence there
1. Europe offshore includes Swiss banks and institutions from other European offshore centers, such as Andorra or Luxembourg 2. Market performance (also including M&A activity)
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities. Numbers may not add up due to rounding

2 ROA and Revenues
Strong AuM growth not fully monetized as share of managed
products decreased by 21% compared to precrisis levels
Offshore banks1
asset mix (%) 2007-2012
Onshore banks
asset mix (%) 2007-2012
Global asset mix (%)
2007-20122
20%7
-21% -39%
36% 28% 33%4 37% 36%
-2%
eserved.
67%5
80%8
64% 72% 63% 64%
2007 2012 2007 2012
21%6 14%9 33% 27%
2007 2012
30% 21%
Managed Products3 Other
x% Discretionary Mandates in % of AuM
In line with the decline of managed products, the share of
30
Copyright © 2013
g p ,
discretionary mandates also dropped by 9 percentage pts
1. Includes institutions from Switzerland, Andorra, Spain, Singapore, Hong Kong and Latin America 2. Excluding brokers 3. Mutual Funds, Hedge Fund, Money Market Funds, Private Equity Funds
and Structured Products 4. CH: 33% 5. CH: 67% 6. CH: 19% 7. CH: 26% 8. CH:74% 9. CH: 15%
Note: Averages are weighted by CAL (CAL 2007 for 2007, average CAL 2011-2012 for 2012). CAL is Client Assets and Liabilities. Brokers are excluded. All numbers are rounded

2 ROA and Revenues
Decreasing ROA levels a major challenge for wealth managers –
still some players manage to keep a good top line
Average global ROA1 (bps) Average ROA (bps) by region 2012
RoA (bps)
200
RoA (bps)
115
150
eserved.
94
106 112 111 109 102
150
100
93
76 70 68
106
99
100
81 84 81
92
78
70
79
41
57 54 59
50
0
55 54 53
50
0
Asia-
Pacific
Latin
America
NA
brokers
NA
banks
Europe
offshore
Europe
onshore
2010 2011 2012
4th quartile
1st quartile
Weighted
Weighted average 2012
average
4th quartile
1st quartile
31
Copyright © 2013
1 1. Revenues divided by yearly average client assets and liabilities
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities. Numbers are rounded
Source: BCG Wealth Manager Performance Database, 2011, 2012 and 2013

3 Costs and Efficiency
In contrast to strong AuM and good revenue performance,
costs increased slightly
Costs rising, but less than AuM1 and
revenues (change 2011 – 2012 in %)
Cost development strongly
differing by function
8%
5%
Other Central Functions2
Front-related Services
Accounting, Finance and Controlling 5%
12.9%
15%
eserved.
4%
3%
Legal & Compliance
Human Resources
Asset and Product Management 3%
10%
5%
4.8%
Cost increased less
than AuM and
revenue
3%
1%
0%
Operation and IT
Investment Advisors
Risk Management
3.1%
0%
Communication & Marketing - 8% AuM1 Revenues Costs
Weighted delta 2011-2012
Costs will be a challenge for wealth managers in years
revenue and AuM increases
-15 -10 0 5 10
32
Copyright © 2013
with smaller 1. Asset under Management 2. Include head office charges and FTEs that have been allocated to the private client business unit. Other central functions may comprise for example one-off projects
and restructuring costs if common across years
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities. Numbers may not add up due to rounding and incomplete cost allocations. One participant from Asia excluded due to
structural change of operations
Source: BCG Wealth Manager Performance Database, 2013

4 Pretax profit margin
Despite controlled cost increase and good revenue growth,
pretax profit margins still significantly below precrisis levels
Return on assets in bps1
- 5 bps
Pretax profit margin in bps3
- 10 bps
86 81
eserved.
Cost-income ratio in %2
12
33
2007 2012
+ p.p.
61% 73%
23
2007 2012
2007 2012
Wealth managers have to improve both top line and costs
in order to close gap to precrisis pretax profit margins
33
Copyright © 2013
1. Revenues divided by yearly average client assets and liabilities 2. Cost-to-income ratios are likely to be understated because large banks often do not fully allocate costs to their private-banking
operations. 3. Revenues less total costs from private banking, divided by average CAL.
Note: This analysis is based in U.S. dollars. Averages are weighted by CAL (CAL 2007 for 2007 KPIs, average CAL 2011-2012 for 2012 KPIs). CAL is Client Assets and Liabilities. Brokers are
excluded from 2007 figures. All numbers are rounded
Source: BCG Wealth Manager Performance Databases, 2008 and 2013

4 Pretax profit margin
In comparison to 2011, pretax profit margins slightly
improved, with pronounced differences by players per region
Average pretax profit margin (bps)
by region/business model 2011–2012
Average global
pretax profit margin1 (bps)
45
65
Profit margin (bps)
70
60
50 47
Profit margin (bps)
80
60
eserved.
19
28
21
35
39
33
27
36 35 36
40
30
20
14 15
23 23 26 24
20
15
25 27 27 23
38
42 43
40
23 22 23
12
8
13
-6
12
-6
11
10
0
-10
5 7 7 6
Asia-
Pacific
Latin
America
NA
brokers
NA
banks
Europe
offshore
Europe
onshore
8
20
0
4
2012
7
2011
2010
Average
Change
'11-'12
(bps)
Weighted
average
4th quartile
1st quartile +2 -0 +5 -0 -2 +1
P t Pretax i margins of ft top f performers h show th that t wealth lth
managers
with the right business model can be successful in all regions
34
Copyright © 2013
1. Revenues less total costs from private banking, divided by average CAL
Note: Averages are weighted by CAL. CAL is Client Assets and Liabilities
Source: BCG Wealth Manager Performance Database, 2011, 2012 and 2013
Weighted
average 2011
4th quartile
1st quartile
Weighted
average 2012

5 RM Efficiency
One reason for improved profit margin in 2012 is increased
front efficiency, as shown in higher CAL and revenues per RM
Average Client Assets and Liabilities (CAL) per
Relationship Manager USD M)
Average Revenues per
Relationship Manager USD M)
p g ( ) p g ( )
238 254 241
268 278
239
273
300 242
5
4
eserved.
212 217
113
105
204
171
200
100
1.9
0 9
2.2
2.8
1.5 1.7
2.4
1.8
2.7
2.2
1.7
1.2
2.3
3
2
+9%
0
0.8 0.9
1
0
Asia- Latin
NA
NA
Global
Pacific
America
banks
brokers
Europe
offshore
Europe
onshore
Asia- Latin
NA
NA
Global
Pacific
America
banks
brokers
Europe
offshore
Europe
onshore
2011 2012
Change of Relationship Managers 2011-12 (in %) 0% +1% +2% 0% -1% 0% +1%
Effi i t f t ffi t i i i
35
Copyright © 2013
Efficient front-office management is gaining
importance for wealth managers
Note: Averages were weighted by CAL. CAL is Client Assets and Liabilities. Figures for 2010 and 2011 may deviate from previous stated figures because the sample size has increased

Key trends that will shape wealth management for the rest of
the decade
Market
• Growth rates significantly higher in emerging markets than in developed world
Landscape
Trends
• Boundaries between wealth mgmt, asset mgmt and IB will break down
• Digitalization will require IT to play a more active role in the business
eserved.
Client
T d
• Traditional value propositions are fading
• New sources of value spring from deeper insight into diverse customer needs
Trends p g p g
• Nature of client interaction will change with emergence of Generation Y
Business
Economics
Trends
• Regulations will add costs and complexity
• European players will have to adapt as retrocession payments wind down
37
Copyright © 2013
• Overall pressure on margins will continue
Source: BCG

Key actions to be taken by wealth managers
Build a presence in high-growth
markets and client segments
Offer segment
specific value proposition
Develop technology- and
big data-enabled distribution
Enable IT to support
business agility and innovation
eserved.
Achieve leadership
Leading
Wealth Manager
2020
Embrace client centricity in investment solutions
Drive excellence in execution
of transactions and financing
Embed operational
excellence into the organization
Develop multi-booking-
center capabilities
Attain top performance
in advisory and services
38
Copyright © 2013
Each wealth manager needs to find its individual set of
actions given its organization & competitive environment
Source: BCG

World wealth money management 2013 update press briefing nyc- version dec2013

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