Why banking is often a balancing act

Improving a private bank’s technological capabilities does not have to equate to a compromise in the quality of customer service it provides, as Compagnie Monégasque de Banque is demonstrating

With a vast collection of ultra-high-net-worth clients, Monaco's banking marketplace is highly competitive and requires a great deal of expertise 

Modern-day customers have more factors to consider than ever before when choosing their financial services provider, ranging from technology and security to customer service and strategy. The industry’s service offering continues to grow and develop at a rate of knots, bolstered by powerful new tools such as robotics, big data, artificial intelligence, blockchain and cloud technology, which will continue to be disruptive for years to come.

Meanwhile, online banking is becoming increasingly sophisticated and, along with mobile banking, has radically transformed the way clients manage their finances. A push for technological innovation, however, must be counterbalanced by the development of creative and holistic strategies in order to safeguard clients’ money in the face of cybersecurity risks.

Privacy and excellence in customer service are the two pillars that support all of Compagnie Monégasque de Banque’s initiatives
and projects

At Compagnie Monégasque de Banque (CMB), we aim to strike the perfect balance between technical developments and security advances by investing in improving our customers’ experience while ensuring their funds are protected. We have actively embraced major technological changes and have recently undertaken concrete steps to be more digitally mature through the implementation of innovation-led solutions throughout our administrative and IT departments. For instance, we have expanded our service range with the acquisition of a new client portfolio from a bank in Monaco’s financial centre, which was successfully integrated into our processing systems and procedures. The deal increased our assets under management by 10 percent.

Safeguarding security
CMB recently completed the migration of its central IT system to an integrated information system dedicated to private banking. This new platform is at the forefront of the market with regards to its technological capabilities. As well as providing access to services in a manner that meets the high demands of our business, the platform offers full traceability in terms of compliance and the scalability required to meet the challenges faced by private banks.

Additionally, we have entered into a new partnership in the field of electronic payment systems, following a change of lead manager for our representatives at the Visa-Carte Bleue consortium. This deal leaves us better placed to keep our finger on the pulse of technological developments in payment methods. Today, we are proud to offer one of the most secure platforms currently available, which is supported not only by cutting-edge technological tools but also by our illustrious employees.

Privacy and excellence in customer service are the two pillars that support all of our initiatives and projects. Our exceptionally low staff turnover rate enables us to develop long-term relationships based on trust and respect with our clients. These relationships can only last if we provide our clients with the highest level of confidentiality and security, leading us to constantly seek out tailored and innovative solutions to mitigate risks.

With this in mind, we recently created a new position – chief information security officer (CISO) – to monitor our security policies, ensure that CMB protects its information capital and reduce conduct risk within the organisation. While all our employees, no matter what their position within CMB is, are offered courses on cyber risk management, we felt it was important to introduce a new managerial figure who can ensure best practice is continually adhered to with regards to cybersecurity.

Part of our new CISO’s role will also include staying up to date with legislative developments and making the necessary IT changes to ensure we are compliant. For example, Monaco recently issued a law requiring strategic players to adopt best-in-class measures to protect their clients and data against cybersecurity threats. A specific authority, AMSN, has been created for that purpose. We fully support this legislation and will work diligently to ensure all of our responsibilities are met.

Heart of the business
Our technological developments are underpinned by a commitment to operational excellence within every aspect of CMB’s business. This is evident both in our day-to-day operations and our long-term strategy, and is achieved through a focused approach by our staff. They work diligently to support our clients through direct personal contact and behind the scenes; always with the spirit of teamwork and collaboration that we value greatly.

At CMB, we strongly believe our back-office functions have a strategic role to play in supporting our everyday activities and can make a decisive contribution to our overall quality of service and delivery. For this reason, we ensure that we recognise, support and reward these team members alongside our front-of-house staff.

For example, in 2017 we created a ‘change management’ unit to provide internal training and guidance for the personnel involved in conducting major transformational projects. We view this as a long-term investment in empowering our staff with knowledge and maintaining operational excellence.

Illustrious clientele
As a private bank, we recognise that ultra-high-net-worth (UHNW) clients have needs and expectations that extend above and beyond those of the average customer. That is why we are committed to surpassing the traditional definition of customer service. Commitment, innovation, integrity and discretion are some of the core values that define CMB and are expected by our UHNW clientele.

This segment of people may also require specific products, such as dedicated funds. For this reason, we have built on our product offering and are now the main player in Monaco’s mutual funds market. We have launched and continue to manage a large proportion of the 60 Monaco funds authorised to date. Moreover, CMB is able to offer easy access to financial markets, with opportunities to trade, for example, non-deliverable forward currencies.

Monaco’s marketplace is highly competitive, boasting more than 30 banks and 60 asset and wealth management companies on a territory of two square kilometres

Catering for UHNW clients leads us to work closely with many family offices. Our unique positioning and product offering enable us to be a partner of choice for single and multi-family offices in Monaco, allowing us to accompany wealthy families and independent wealth managers at every step of their investment journey.

We understand that these consumers often pursue a globally nomadic lifestyle. As such, it is imperative that we provide our clients with top-of-the-range mobile and online banking solutions, enabling them to easily edit detailed portfolio statements available in several languages via our e-banking platform. Additionally, they are able to manage their portfolios and make transfers on the go via the CMB Mobile Banking app for smartphones.

With regards to meeting UHNW clients’ expectations, we recognise that Monaco’s marketplace is highly competitive, boasting more than 30 banks and 60 asset and wealth management companies on a territory of two square kilometres. For this reason, it is all the more important that we maintain extremely high standards in order to retain our position as one of the leading private banks in the principality.

We have garnered this reputation thanks to our excellent capital ratios and emphasis on personal relationships. CMB’s balance sheet is second to none with regards to its exceptional solidity. Furthermore, the fact that CMB has governance and decision-making bodies based in the heart of Monaco is a distinctive strength: this enables the highest degree of responsiveness and the ability to adapt to clients’ expectations in a rapid and efficient manner.

Looking ahead
As we look to the future for both our business and the banking sector, we remain vigilant of the many risk factors that continue to threaten the latter in the aftermath of the 2008 financial crisis. Low – even negative – interest rates are an obvious threat, as well as cyberthreats, due to the ever-evolving nature of technology.

In the next few years, we believe digital disruption and competition will intensify. In this new environment, those industry players with a traditional banking culture may struggle to adopt a digital mindset. Developing and retaining the right talent to not only face these major risks but turn them into opportunities will be absolutely necessary. CMB believes it is of the utmost importance for private banks to embrace major technological developments as opportunities to further develop and innovate.

In the midst of an onslaught of innovation, however, operational excellence should not be forgotten. It is vital to remember that the responsiveness of the back office and the ability to process complex investment requests and keep error rates to a minimum are crucial for the continued functionality of the business. By balancing these aspects, as CMB does, private banks will ensure that they remain stable and profitable in the years to come.