PRIVATE WEALTH MANAGEMENT:

A process based approach for accumulating, protecting and growing our Private Clients wealth. Some of the ingredients of this process are: Financial Diagnostic (define aspi ational needs! dete "ine is# appetite and st ategic asset allocation$% The most critical decision behind investment success is arrived at with an in house scientific process to quantif the aspirational needs ! requirement of the client famil .

&o' cing (est F'nd Manage s ) In*est"ent Ideas% The second most critical decision behind investment success after determining the ris" appetite of a client which is arrived at on the basis of a scientific methodolog is a comprehensive manager selection process designed in#house. As an $ndependent %ealth &anagement 'irm we our able to source the best investment managers and ideas for our private clients.

E+ec'tion ) In*est"ent Pe fo "ance Monito ing% (nce the investment mandates and benchmar"s have been defined, this is followed thoroughl and tactical asset allocation is complied with. A robust reporting s stem helps us trac" performance based on the state of the art and accurate performance measurement techniques. This allows a client to compare the performance of their investments in a uniform manner.

Ris# Manage"ent% )ased on proprietar quantitative models developed in#house, we are able to reduce the ris" in our client portfolio thereb , optimi*ing the return per unit of ris" ta"en b our Private Clients.

,' ent P i"a - Foc's of Wealt. Manage"ent ('siness Ho'ses

+ualified advisors will be the best brand ambassadors for new firms see"ing to gain a competitive edge against established pla ers. $nvestor education programs could deliver information pertaining to various asset classes and the associated ris"s, fee structures and benefits of each. ,stablishing trust is a vital component for an successful brand#building e-ercise in $ndia.

&t ategies /pted 0- Wealt. Manage"ent ('siness Ho'ses

$nvest in brand building to build trust. $nvest in advisor technolog to improve productivit and advisor retention. (ffer a ./0#degree view. Shifting to a profit#sharing model 1where the advisors fees are based on the overall performance of the portfolio2 would help mitigate issues to some e-tent.

I""ediate Iss'es 0efo e Wealt. Manage"ent ('siness Ho'ses

3ifficult in putting a value to our service 4 advice. )uilding the right business model. &aintaining bro"erage structure ma be difficult and cumbersome and bul" . Technolog 5 (nline platforms with direct investments. $mmediate cash#flow concerns.

Need fo 1'alified Ad*iso s

The Current $ndian 'inancial Advisor &ar"et is loo"ing for )rand building through its 6+ualified Advisors7 as )rand Ambassadors. +ualified Advisors shall develop trust with the clients on a better footing. +ualified advisors will be the best brand ambassadors for new firms see"ing to gain a competitive edge against established pla ers. Advisor platforms that offer lead management, portfolio management, financial profiling, asset allocation and transaction management capabilities can integrate multiple touch points and improve advisor e-perience. $'As require a qualification to equip themselves with the required s"ill set and "nowledge to call themselves as +ualified Advisors.

T2PE& /F PLA2ER& IN THE PRIVATE WEALTH IND3&TR2

PRIVATE (AN4ING E,/N/MI,& As a segment of the overall wealth management mar"et, the 89$s and :89$s attract more attention, and with good reason. 'or global private ban"s, the $ndian private ban"ing mar"et showed stronger growth of around ;<= in '> ?0;; compared with the growth of most other mar"ets of /= to @=. 3omestic institutions are also interested in the 89$ segment to complete their offering and get a share of a more profitable segment. 8ence, the economics of this segment are of interest. 8owever, data on revenues and profitabilit is hard to come b in the wealth management industr . According to the &cAinse Private )an"ing Surve ?0;; report, the $ndian private ban"ing mar"et had e-perienced a ver good ear in ?0;;, with higher growth than most other mar"ets and a doubling of profit margins driven b reduction in cost margins. This was after '> ?0;0 which showed B0= growth. The surve showed different business models and si*e of business impacts both revenue and cost#margins in the $ndian mar"et. )an"s showed higher revenue margins as compared with pure advisers while sub#scale pla ers have significantl higher cost margins as compared with scale pla ers. $n a difficult environment, ban"s had increased revenue margins from << basis points 1bps2 in ?00@!;0 to CD bps in ?0;0!;;. (n the other hand, revenue margin of advisers appears to be under pressure, falling from B. bps to ./ bps. Trehan of &cAinse e-plains there were two issues: first, the revenue margins were low as participants were focusing on the e-treme top end of the mar"et, the :89$s, so their margins were lowerE secondl , the profit margin of .0 bps is comparable with developed mar"ets. (nl the advisers focusing on :89$s have lower margins. %hile lower in other mar"ets as well, there is a significant drop in $ndia of B0= to /0= from the higher end.7 Trehan believes that the margin pressure at the :89$ segment is partl because large famil offices have started to emplo their own professionals. 6The larger famil offices are Fust dealing directl with the institutional des"s, especiall if the come with a large corporate partner.7 %here the famil offices do not emplo their own staff, the competition is ver intense. The cost margins for $ndian private ban"s of around B. bps are approaching best#in#class levels. ,ven the %estern ,urope mar"et had a cost margin of B@ bps while the cost leaders were Central and ,astern ,urope and the :S have cost margins of B0 bps and B? bps respectivel . The cost margins have decreased over the last ear, driven primaril b the reduction of sales and mar"eting costs, which includes the frontline adviser costs. Advisers had shown increased productivit though this differed across cities.