With a 28% share, bank is leader in Brazilian market

07/13/2022

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Percy Moreira, Fernando Beyruti and Felipe Nabuco — Foto: Silvia Zamboni/Valor

The new structure of Itaú Unibanco’s private bank, put in place at the beginning of the year, seeks to consolidate a global vision for the whole business with the unification of the domestic and international segments of the group. In an exclusive interview with Valor, the three executives who took over the wealth-management branch of Brazil’s largest private-sector bank, which serves people with at least R$10 million in investments, say that one of the strengths of this integration and total customer service comes from the migration of systems to cloud computing.

“With the change, there will be a single system for all the bank’s units, including Brazil, Switzerland, the United States, and Portugal,” says Fernando Beyruti, who took over Itaú Private Bank as global head in January. “The technological transformation will allow the bank to have much more customer data, provide a reduction of the inefficiency of the legacy systems and integrate solutions and products from all businesses of Itaú, from investment banking to asset management,” adds Felipe Nabuco, the private bank’s head of investments and client relations.

The third member of Itaú’s new structure is Percy Moreira, CEO of Itaú USA and head of international private bank, assuming a position that belonged to Mr. Beyruti in the old structure: “In this model, we end up playing more closely together,” Mr. Moreira points out.

The trio now runs a business that gathers R$700 billion in assets under management and a 9,500 client base. With a 28% share, Itaú is the leader in this market in Brazil. Itaú Private Bank’s global head explains that the goal is to exceed R$1 trillion in assets and reach a 35% market share.

Mr. Beyruti considers that there is no specific deadline to reach those goals. “This growth will be a consequence of our mission of providing 360-degree service to clients,” he says. “It is to meet the demands of the client’s life, both local and international investments, as well as succession planning, tax, and other needs.”

According to the executive, “we do not doubt that personal contact in private banking is something that will not be lost,” he says. “As we go down the generations, the client wants to have self-service, he wants to have the digital part.” For this reason, the integration of all systems into just one will allow, in Mr. Beyruti’s view, great flexibility, agility, and efficiency to implement new products and platforms. “We have a slogan of having ‘a bank for each client’, and this requires a just as good as technology infrastructure.”

The private bank’s global head added that before the migration to the cloud, changes to systems could take months. “In the old system, anything new that came along, whether it was a regulation, or a new product could take about six months to develop. Now with APIs [sets of protocols that allow rapid integration between systems] and systems in the cloud, it’s much easier to develop any solution in a few days.”

Data analysis also becomes much more effective and faster, which allows the bank to foresee some demands and offer conveniences, Mr. Beyruti says. “For example, if we know that a customer travels a lot, why don’t we automatically unblock his card [for use abroad]? Or if a customer often goes to a certain restaurant, we can create a specific promotion for the specific place to offer an experience, obviously respecting privacy.”

According to Mr. Nabuco, “a major advance in this new structure is that, besides the banker, who usually considers the commercial aspect, the investment team now also has global thinking.” According to the executive, “we used to have an investment team focused on the Brazilian market and another one focused on the international market, but it is no longer possible to have one person thinking about Brazil and another one thinking abroad. You have to be always thinking in a much more comprehensive way.”

In Mr. Nabuco’s evaluation, “when you look at the platform, it is not only about investment.” According to the executive, “investment is a stretch of the journey, which is made up of services and conveniences.” Mr. Moreira adds that “we really aspire to use [the experience] out there as a great gateway to the private banking world for new experiences for the Brazilian client.” Besides, considers Mr. Beyruti, “one of the advantages of Itaú is that it is a universal bank: I can offer the private banking client investment banking services, credit, insurance, I can offer everything, right?”

Another expansion strategy for Itaú’s private-banking business is a more intense regionalization process. According to Mr. Nabuco, “outside the largest local markets, there are places where private banking has no physical presence and, in these places, our market share drops to 15%.” According to the global head, “in this regionalization project, the idea is, with the broad bases we have today, that the íon investment offices will be our investment agents in places where we do not yet have a physical presence of the private banking.”

The íon (Itaú’s investments platform) offices started to open in March 2021 and already have R$400 billion in assets under management. The network already has 110 offices open and the goal is to have 129 locations, with 2,500 specialists, by the end of the year throughout Brazil. In the coming months, units will be opened in Recife (Pernambuco), Rio de Janeiro, São Paulo and Petrópolis (Rio de Janeiro state). According to Mr. Nabuco, “with this network, we will be able to identify potential private clients.”

In Mr. Beyruti’s view, in this arrangement “we can detect the affluent [client], that is, the one that is going to be a client of the private bank at some point and we already have him on the radar.” This way, “much earlier we have someone there helping this client in his growth.”

Another new feature that is starting to be implemented is to have specialists per area to identify specific demands from clients. “We started with technology, we have a banker who will serve the tech segment, so he knows the demands and what we can offer to this client and his company.”

Itaú’s private bank has also strengthened the events business, such as those aimed at preparing the new generations that will assume responsibilities in the family businesses. “We have several in the pipeline,” says Mr. Beyruti. “For example, we are going to take some clients to attend a course on venture capital at Harvard, and we have another one in which we bring together several families to meet and learn from each other.”

*By Sérgio Tauhata — São Paulo

Source: Valor International