Delving into the realm of private banking, our conversation with Sanjay Wijemanne, DGM Retail Banking Group, HNB offers insights into the strategic shifts within the Sri Lankan banking sector amidst economic uncertainties. Read on as we explore how these transformations have influenced customer behaviour and shaped the bank’s service offerings to cater to a new generation of customers.
What strategic shifts have occurred within the Sri Lankan banking sector in response to recent economic uncertainties, and how have these changes impacted customer behaviour and service offerings?
In recent years, economic uncertainty in Sri Lanka, characterized by fluctuating exchange and interest rates, has led customers to seek advisory services over traditional transactions with financial institutions. High-end clients, in particular, have demanded enhanced expertise from banks and relationship managers (RMs) to navigate this volatility. Consequently, there’s been a shift towards established banking institutions, with clients prioritizing stability and a wider array of financial services, including personalized advice on tax, legal, and estate planning. The pandemic accelerated digitization efforts in the banking sector, prompting the introduction of fully digital banking experiences and streamlined onboarding procedures. Amid increased scrutiny from customers and regulatory authorities, banks have focused on demonstrating stability and reliability, with the Central Bank playing a pivotal role in oversight and regulation.
What strategies has your organisation implemented to adapt to the changing landscape of customer demographics and the increasing importance of digital channels?
In light of the shift towards digital platforms, we’ve recognized new opportunities to engage with customers more efficiently. Our focus has been on leveraging our digital channels and social media marketing to attract customers by offering a diverse range of products.
Notably, we’ve observed an increase in younger clients, particularly those in the 25 to 30 age bracket, expressing interest in our private banking services, traditionally associated with older demographics aged 50 and above. This demographic shift presents a promising opportunity for us to expand our client base and cater to a broader range of individuals seeking the benefits of private banking.
Recognizing the diverse needs of our clientele, we’ve adopted a segmented approach to product design and service delivery. Rather than adopting a one-size-fits-all approach, we tailor our offerings to meet the specific requirements of different customer segments, including youth, working professionals, and business owners.
Our strategy is informed by ongoing research, particularly regarding the preferences and evolving needs of our high-net-worth clients. We’ve noted a growing demand for value-added services and a desire for more sophisticated wealth management solutions. As a result, we’re dedicated to enhancing our offerings to meet these evolving expectations.
Could you talk about the benefits and some of the privileges that these private banking customers can experience?
The transition from catering primarily to the older generation to focusing on the younger demographic is a noticeable trend in our current operations. We’re directing our attention towards younger entrepreneurs, executives in listed companies, and emerging professionals. Unlike their predecessors, this demographic possesses more complex needs and preferences.
Addressing these complexities requires a sophisticated approach to providing tailored solutions. Personalization is key, along with offering a diverse range of banking products beyond traditional offerings. This younger cohort values accessibility and autonomy in decision-making, hence the importance of readily available relationship managers who can engage in meaningful conversations and provide guidance. Furthermore, we offer dedicated spaces referred to as priority lounges across key locations in our network in addition to our flagship private banking centre at Green Path, Colombo 3.
Recognizing the importance of relationship managers in meeting these evolving needs, we’re heavily investing in their development. This includes enhancing their advisory skills and leadership capabilities to serve our clientele better. We see this as complementary to the rise of digital banking and artificial intelligence.
In terms of benefits tailored to our high-net-worth segment, we’ve introduced a tiered system that offers competitive interest rates and preferential lending terms. Additionally, members of our priority segment enjoy exclusive lounge access at both domestic and international airports, along with other perks such as waived fees and discounted charges.
Philanthropy is another area of interest we have identified in our priority customers, which we facilitate. We’ve completed three impactful projects in one village, benefiting 650 families. From providing clean drinking water to schools and road development projects, our focus is on philanthropy, not just charity. Customers join us on village visits, fostering a deeper connection with the bank. It’s more than writing a cheque; it’s about experiencing the impact firsthand and feeling a sense of ownership in the change we create together.
How does your organization’s integrated approach to advisory and concierge services enhance the overall client experience, particularly in addressing emerging needs and ensuring peace of mind for clients?
As mentioned earlier, the primary interaction occurs between the relationship manager and the client. However, our service extends beyond this point through an ecosystem comprising five advisory partners and concierge services.
On the advisory front, we offer expertise in the equity market, tax advisory, and insurance advisory through our subsidiary, in addition to legal advisory and a unique service – art advisory. Additionally, we provide medical concierge services, both locally and globally, including visa concierge assistance. Our goal is to provide customers with a holistic, end-to-end experience that ensures convenience and peace of mind. Whether it’s addressing legal matters, tax issues, or any other concerns, we aim to streamline the process so customers don’t have to run around.
Some of these services, such as insurance, have gained greater significance recently as people reassess their coverage needs in light of changing circumstances. While these offerings have always been available in our portfolio, their utilization has increased due to shifting priorities. This heightened demand underscores the importance of our proactive approach in anticipating and addressing our clients’ evolving needs. For instance, recognizing the demand for travel insurance among our senior priority customers, we promptly engaged with our partners to provide suitable coverage options tailored to their needs.
Similarly, our collaboration with Parkway Hospitals Singapore for medical services illustrates our dedication to providing comprehensive support to our clients. This collaboration involves on-site informative sessions, covering various medical topics to equip our clients with essential knowledge for their health and travel needs.
We’re keenly aware that while product development is important, it can be quickly replicated. That’s why our focus on service sets us apart and keeps us ahead of the market. Currently, our private banking services excel in this aspect. While we aim to extend this level of service to our 200 plus branches it’s no easy feat. However, it’s our primary focus to ensure excellence in service delivery.