There are few better positioned then Dr von Maltzan to take Deutsche Bank Private Banking into the 21st century and compete against the best. The 52 years-old banker has been with Deutsche for since 1978, being responsible for the private banking business of Deutsche since 1996. He exudes a cool sophistication, whether he is overseeing the growing private client business from Deutsche's Alex Brown operation in New York, or lunching with clients in London.

"Private bankers are having to acquire more skills then ever to work in this marketplace, as the client is becoming more demanding and less tolerant of bad performance," comments Dr von Maltzan.

He may be muttering what's on the mind of many senior private bankers globally, but Dr von Maltzan is putting these principles in practice. The importance of training of Deutsche's private banking staff is uppermost in the strategy of the bank. The bank has made various partnerships with universities, which allow staff to learn about innovative new developments pertinent to private bankers and their clients.

A financial consultant study programme has been set up at the University of Bochum in Germany, an exclusive graduate study programme was also established at New York University and there has been funding for a chair for the real estate and housing industry a the University of Leipzig.

The strengthening of private banking offices throughout Germany has also been a priority. In the seven major regions of the country, management presence has been strengthened considerably through the appointment of additional senior private bankers. "For the customer this means more individual and sophisticated local know-how and even better access to the global private banking network," commented von Maltzan.

Von Maltzan believes that education is key to improving the performance of staff in the bank, but he also is a strong proponent of empowering relationship managers. "This is very much of our culture, and we think that this helps to assuage concerns that there is too much control from Frankfurt, allowing private bankers to operate within their own culture and the practices of the markets they are operating in.

The empowerment principle goes hand-in-hand with Deutsche's global business and the various acquisitions that have taken place in the last few years. Deutsche's private banking business has been on a bit of a buying spree of late, acquiring Banque Worms last year, which includes a sizeable private banking business in France. Deutsche has also developed the concept of "smart partnering", where alliances are made with other banks, or parts of a bank to improve performance. For example, a Paribas team in Switzerland joined Deutsche's private banking last year. They brought the clients, Deutsche had the global infrastructure and products.

Deutsche has also made it clear that further acquisitions are very much part of its growth strategy, particularly in Western Europe. The desire to improve distribution channels will drive the acquisition process forward. Although von Maltzan was not willing to be drawn on whether an acquisition in the UK was likely, this market must look ripe for expansion for the bank with pan European aspirations. And trying to grow the business through the Deutsche Bank brand name might not be such a good strategy in the UK. "Credit Suisse successfully bought part of the SG Hambros business in 2000 - a similar acquisition could be the way forward for us," argues von Maltzan.

New Products

Deutsche is also keen to improve its product offering. Capitalising on the surge in interest for hedge funds it recently launched its XAVEX HedgeSelect certificate across Europe, which attracted around EUR 2 billion since its launch last summer (see PBI 150). The bank is also introducing open financial architecture and is already using third-party products in its mandated business and will integrate them across the board in the next few months.

Alternative investments such as hedge funds represent just one strand of product diversification for Deutsche, emphasis is also been placed on real estate portfolios. These are also beginning to integrate third-party products.

Pricing transparency is also a key part of Deutsche's new initiatives. "Customers demand complex and high-quality advice from us. This advice is our core service. And this core service is at the centre of our pricing policy. Moreover, the costs of advisory services are now being made far more transparent to the customer," comments von Maltzan.

Through the introduction of an advisory fee, Deutsche plans to accompany this with drastic reductions in transaction fees. Furthermore, front-end fees for the Group's own investment funds and online transactions will be reduced by 25 percent.

These and other initiatives, including ambitious e-commerce plans and the reorganisation of units within the banking empire, should help Deutsche's private banking aspirations to be among the best in Europe. But, whether Deutsche can take on the likes of the Swiss behemoths, Credit Suisse and UBS, time will only tell.

"I think the Swiss shouldn't be complacent, but believe competition at the top will be between Credit Suisse and UBS in Europe and no one else. Deutsche is well placed to be one or two placed below, but the hierarchy isn't going to change for some time," argues a London private banking analyst.