Interview with Nicolas Commerot
Global head of advisory at Societe Generale Private Banking
You made a video presentation of the Diagnosis & Asset Allocation which gives a real-time view of clients’ asset allocation. With this decision-making tool is the client now in charge?
It’s interesting to ask the question in this way because it reflects a common misconception. At Societe Generale Private Banking, fortunately, our clients are and have always been in charge! This digital tool’s real aim is to support our clients so they become even more involved in structuring their investments and to align their portfolio more closely with their long-term needs.
We always try to be as close as possible to our clients’ needs and expectations. Behaviours change quickly. To take the best decision they expect us to provide them with information in the most transparent and instructive way possible. Thanks to this approach, digital D&AA allows them to understand very simply their tolerance to risks and the benefits of diversification. They are given an analysis of their current situation (the diagnosis) and can reallocate assets and evaluate the impact of this re-allocation (simulations). These two functionalities help them understand which asset allocation suits them best.
This innovation allows our advisors to co-define with each client his asset allocation, whether in our meeting rooms or at his homes. This first step in the investment process is essential, as it gives us a special opportunity to discuss with our clients and to better identify their needs, constraints and expectations.
You talk about a “first step”, does that mean that you plan to launch other advisory offers in 2018?
Investment has always been one of SGPB’s strengths. With regulatory changes and the transformation of our clients’ consumption trends, we continuously adapt our offers to provide relevant solutions. For this we have reviewed our customer service philosophy and base our offers on our clients’ behaviour (discretionary management, advisory management or execution only).
In terms of investment advice, our clients want to be supported while remaining in charge of their decisions. We are therefore changing our offers according to how much advice they want and to the amount of time they can spend following their investments.
The current challenge lies in our capacity to deliver a good quality of service to a very large number of clients. Thanks to digital technologies, we can now offer solutions and arrangements that one couldn't ever imagine just five years ago.
New offers were launched as pilots in several international entities in 2017 and will be deployed more widely in the whole Private Banking in 2018.
Do you mean to say human contact in investment advice is over?
Of course not: nothing will ever replace a human relationship and proximity with our clients, which is the cornerstone of SGPB’s philosophy and history.
But today our clients want more immediacy, greater flexibility and more distribution channels. They want to be able to choose or switch
between digital and human interactions, according to the time they can dedicate to their investment’s and the moment they choose to do so.
To meet these new expectations Société Générale Private Banking is launching the “Active Advisory” programme and our teams are organising to support our clients.
What exactly is Active Advisory?
Active advisory is based on two uses:
- First of all, it is a tool for our investment advisors that will allow the bank to offer enhanced advice to our clients. The technology is based on a hybrid man/machine principle so our clients can benefit from the Private Banking's expertise and from technology.
- But it is also a B to C pilot offer for a digital investment advisory service launched during the first quarter of 2018, allowing clients to receive personalised investment advice via text messages and E banking that they can execute in a few clicks.
The algorithm we use is based on the expertise of Société Générale Group and of 300 experts from the Private Bank to offer the best possible investment recommendations while strengthening portfolio monitoring.
Artificial intelligence and its transcription in natural language makes it possible then to explain to our clients precisely and in a personalised way the reasons for the investment recommendations made.
Will this digital tool mostly allow you to serve more clients?
In a way, we would like to democratise investment advice. While certain players will reserve this service to a very limited number of clients to meet the new obligations imposed by MIFID II, Société Générale Private Banking is on the contrary making the strategic decision to widen this service to the greatest possible number of clients using these extremely innovative digital tools.
Indeed, we think that everyone has a right to proactive, quick, personalised and reliable investment advice, and that digital tools are a great help to offer this service while maintaining the highest quality standards required by our private banking clients.
Société Générale Private Banking has decided to widen its Advisory services by relying on new and extremely innovative Digital tools.