Evaluating wealth management capabilities between banks isn’t straightforward because so much of the service verges on the intangible. However, this year there was a hard number that seemed solid enough on which to base the decision. Between the first quarters of 2020 and 2021 XP Private grew its assets under custody by 263% to R$240 billion.
XP Private’s chief executive, Beny Podlubny, told Euromoney in March this year that almost 100% of the new money was explained by IPOs, secondary offerings and M&A.
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The ability to hoover up so much of this liquidity from these Brazilian capital markets events is impressive and validation of the business model of this relative newcomer in Brazilian private banking.
The quality of the venture is reflected in the standard of recent hires: Paulo Leme, a big hitter in the Brazilian market and former president of Goldman Sachs Brazil, became chairman of XP Private’s global asset allocation committee; Artur Wichmann, former portfolio manager at Verde Asset Management, became chief investment officer; Daniel Frajhof joined from Goldman Sachs to head up the business-to-consumer team; and Roberto Azevedo, former partner at Turim Family Office and former director at Banco Modal, became head of multifamily offices.
XP Private now has the largest private banking team in the country, with 140 internal independent financial advisers (IFAs) and 132 affiliated; 85 of the 132 affiliated IFAs joined the team during the last 12 months.
XP Private and BTG Pactual are engaged in a public fight for IFAs, with both offering equity to attract the larger groups to their platforms, but it seems it is a war that both can win. BTG Pactual’s asset management business attracted R$60 billion in 2020. But for now, XP Private has the momentum and huge market share.