During a recent visit to Monaco, this news service sat down with the CEO of CMB Monaco to discuss his parent group's mission to continue building the private bank and wealth management group, the challenges of the current environment, and his plans for the future.

A few days ago, Milan-based Mediobanca said it intended to grow its wealth management sales force by 25 per cent. To achieve this target, part of its group – CMB Monaco – will have an important part to play. 

Mediobanca’s three-year strategy noted that CMB Monaco has “undergone a significant repositioning and growth process in recent years, with assets, revenues and profits all doubling (total financial assets up from €8 billion ($8.57 billion) in 2016 to about €15 billion, revenues up to €162 million, and net profits rising to around €57 million).” (These were June 2023 pre-closing numbers.) In total, Mediobanca wants all its wealth businesses to employ more than 1,500 people over the 2023 to 2026 period.

To put this in context, CMB Monaco has a total of 249 employees, 98 of whom work at the front office in client-facing roles.

Francesco Grosoli, chief executive of CMB Monaco (pictured), who recently spoke to WealthBriefing during a visit to his elegant offices in the principality, is excited about the growth mandate from Mediobanca. 

“We have a lot of prospects coming up,” Grosoli, who has worked in the banking industry for 34 years, said. What firms such as CMB Monaco offer is more “holistic” in the approach than the term “private bank” might suggest, he said. “We are a trusted advisor for the client and not just providing private banking services. We want CMB to be part of the global brand of Mediobanca.”

The private bank works closely with the investment banking and corporate banking division of the Mediobanca group, tapping into how many UHNW clients are creating , operating or exiting companies. They’re often entrepreneurs who want access to advice and a strong balance sheet. “We want to be a `one-stop-shop’ for these entrepreneurs doing business in Europe. We are bringing the relationship to a completely new level,” Grosoli said.

Mediobanca's focus on wealth management as a growth channel was already well established, Grosoli said. “It is now an acceleration of the wealth management domain. It is also about giving more international reach to the [private banking] group and covering more international clients in Monaco and Europe,” he said. 

The CMB business has grown via organic growth and acquisitions. In February 2008, Mediobanca acquired Unicredit’s private banking activities in Monaco through CMB. The deal followed the acquisition of ABN AMRO’s branch in the principality in November 2006. CMB also recently acquired a group of former Pictet bankers to form a new team dedicated to serve its British clientele, Grosoli said. ( Alistair James, team leader with more than 20 years of experience (Lloyds, Coutts, Barclays and Pictet) and Pierre Guilleman, a wealth manager with 15 years of experience (Coutts, Barclays and Pictet.) 

Besides Grosoli, other senior figures at CMB are Kamran Djavadi, chief operating officer; Olivier Pagès, chief innovation officer and chief of staff; Sophie Saurini, head of wealth management and private banking; and Jérôme Maman, head of investment and credit services.

Capital: “the three Cs”
Technology will be important in this regard, as will talent management and development, Grosoli continued. 

“Growing a wealth management and private banking business without technology is going to be the real challenge of the future,” he said. The CMB “recipe is around the “three Cs: capital, technology capital, and human capital”.

“As an industry, we haven’t reached the technology that is necessary to serve future clients.” Large firms, unlike new players, have the benefit of scale and incumbency; the downside is that they are more complex to manage. Certain niche players, unless they have tremendous offerings, are likely to struggle in this space, he said.

CMB Monaco is also ramping up its marketing and publicity campaigns, including sponsorship of sports activities in Monaco, for example. Its work in presenting investment ideas/investment-related ideas to existing and prospective clients also helps spread the message, he said. 

Grosoli knows that in uncertain times, the attractions of stable jurisdictions such as Monaco, carry weight. (See a report here.) Monaco also competes against other international financial centres such as London, Geneva, Zurich, Dubai, the Channel Islands, and Singapore. Its proximity to France, Italy and Switzerland gives it an obvious European “flavour,” but residents come from far and wide. And those who move to Monaco aren’t just individuals or couples looking to stay for a few weeks. Families are increasingly part of the mix. And that’s affecting the market for homes and facilities.

“A lot of people are coming to Monaco for the security and its lifestyle,” Grosoli said. There is good education and healthcare. “We are seeing many more families with young kids relocating here.” The dynamic means that people are looking for larger homes rather than one or two-bedroom apartments, he said. 

This is a high-density location, with a smaller size than New York’s Central Park.

“In the past, people did not spend so much time in the principality. What we note today is that there are more large apartments. We are going to see a rise on what was built in the past,” Grosoli said. The arrival of more families also correlates with a growing number of family offices in Monaco, he said.

Tapping into the group
Mediobanca has a strong investment bank arm, with roots in Italy, France and Spain, for example, and the private banking/wealth arm can draw on this expertise. Many of CMB’s clients run operating businesses and need to tap into this, Grosoli said. The investment bank side has also helped the private bank cater to clients’ desire to invest in private markets (private equity, venture capital, real estate, infrastructure, etc).

Talent management remains a big challenge. 

“You need to have technical skills…it is not just about being able to wine and dine with clients. You need to be able to understand the psychology of a client to better understand their needs and objectives. You also need people with a strong ethical approach, with transparency and honesty. We look after people who give us guarantees in this respect and offer them internal training. I try to be with them when they are with clients. I have been through the process of acquiring skills and making mistakes,” he said. The firm is developing graduate-level talent, and Grosoli said he relishes the chance to pass on his experience.

“I don’t just want client assets – I want people with talent,” he said. 

A subject Grosoli wanted to talk about is hybrid working.

“Smart working is good because it creates more flexibility but the organisations need to have a culture. If you don’t, that’s difficult. You must make a culture evolve. Behind a computer screen, it is not going to happen. At CMB, human interaction among bankers is a key feature to guarantee a trusted and personalised service for our clients” he said. 

More broadly, Grosoli said the industry continues to suffer from too many people “doing things they should not do,” referring to manual chores and administrative tasks.

The fine print
CMB has two broad client segments: a wealth management services segment requiring clients to have at least €3 million of assets deposited, and its private banking segment, aimed at those below €3 million. 

The wealth management segment is organised through six teams of 31 bankers. Generally, a banker is supported by one or many assistants and covers 30 client relationships. The banker is the “chef d’orchestre” of the client relationship.