Nicolas Aguzin, CEO of J.P. Morgan’s International Private Bank and on the operating committee for the firm’s asset and wealth management business, speaks to Global Finance about post-pandemic plans.
Global Finance: What approach did J.P. Morgan Private Banking take globally to strengthen its banking leadership amid the pandemic?
Nicolas Aguzin: We adjusted the way we interacted with our clients quickly. We have the benefit of being very global, so we could see what was happening in Hong Kong and China, and prepare across all of Europe, Latin America and the US.
Our ultrahigh net worth clients understood the situation and were willing to adapt to new ways of interacting. This included Zoom meetings, electronic delivery and remote online notaries where it made sense. We were also able to deliver dynamic programming on timely topics including Covid-19, the US elections, China-US relations and navigating uncertainty in general.
Early on, we had 95% of our employees around the world working from home. They adapted to the environment swiftly to make sure that the firm could continue to operate both effectively and efficiently.
Continuing on the theme of innovation and operational excellence, our support partners spent over 52,000 hours re-engineering and automating a lot of processes with the goal of enhancing the client experience.
While our strategy has not changed, the pandemic has accelerated several trends and allowed us to move with greater speed in execution and enhancing our operating model.
GF: Do you expect this new interaction with clients to continue in the post-Covid-19 world?
Aguzin: It is clear, human plus digital is key to success. This year, we launched an adviser app that allows our advisers to have anytime, anywhere access to important information on mobile. We also rolled out a new client website called JPO International, which operates in nine languages and covers 141 countries with tons of digital enhancements.
GF: Did you observe a different response to the pandemic from investors across Asia, Europe and America?
Aguzin: There were cycles. One of the great advantages of having a global business is that in February, we were already making plans around the world on how people would operate from home. And today you have a situation where Asia, and in particular China, seems to be one of the few economies around the world that is very strong. We’re actually seeing client investment appetite in this region above pre-pandemic levels.
GF: Do you see momentum in investor confidence in Asia? Where are they investing more?
Aguzin: At the height of the pandemic, many clients had more time to do analysis with their advisers and trade more. As a result, you saw brokerage activity in the first half of the year up quite a bit. For example, our trading activity in Asia was up over 60% versus the prior year.
Megatrends have also been a big area of interest for clients during this time, whether that’s in sectors that are driving growth—like digital and technology innovation, or in health care innovation. Both have gained a lot of momentum.
As well, given the low-rate and low-yield environment, alternatives are an area of great conviction with investors, whether it’s private equity, direct real estate investments, or venture capital.
And last but not least, during this time clients have double-clicked on their commitment to sustainable investments. Year to date, clients have invested over $10 billion across 96 strategies the ESG space.
GF: How do you expect wealth management services to continue to evolve globally in a post-pandemic world?
Aguzin: Across wealth management, there is continued pressure on margins, especially around deposits. I would expect that to continue, given the low interest rate environment.
Another big focus is around trust. While the margin of products are compressing, we also see the margin of trust—the amount that people are willing to compensate someone for financial peace of mind—to be very stable and increasing.
There is an even greater amount of demand today for thoughtful, holistic, high-quality advice and great execution in managing wealth.