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The German Financial Advice Market 2007

Published by: Datamonitor

Published: Feb. 20, 2007 - 57 Pages


Table of Contents


EXECUTIVE SUMMARY
Market Structure
Regulatory Developments
Competitor Dynamics
Opportunities
CHAPTER 1 INTRODUCTION
What is this report about?
Who is the target reader?
How to use this report
CHAPTER 2 MARKET STRUCTURE
Introduction
Key findings
The financial advisory distribution channel in Germany is very large but truly independent advice is still marginal
Germany's financial advisors have not been held in high regard in recent years
Large financial advisory firms and networks are accused of being product pushers
The German insurance sector is experiencing a move towards a more intermediated market
Demand for independent financial advice is expected to rise due to complexity of pension products
There are currently around 500,000 financial intermediaries in the German market
Germany is home to two-thirds of the total European financial intermediary community
The German financial advice market is dominated by single-tied advisors
In the German financial services market banks dominate the sale of mutual funds
Banks have a firm grip on the distribution of mutual funds in the German market
The insurance channel has gained in importance despite pressure from banks
IFAs and other advisors remain a significant channel for the distribution of mutual funds
Fund supermarkets and the direct channel are relatively insignificant in the German market
Data Tables
CHAPTER 3 REGULATORY DEVELOPMENTS
Introduction
Key findings
The Central Bank and the Federal Financial Supervisory Authority regulate the German financial services industry
The Federal Financial Supervisory Authority BaFin represents the German FSA equivalent
Membership in the FPSB association is regarded as a stamp of quality for financial advisors
HNW advisors are organized in the Association of independent Wealth Managers
The European Commission has introduced a number of regulatory reforms affecting financial services in the EU
The Financial Services Action Plan (FSAP)
UCITS III
Insurance Mediation Directive (IMD)
IMD regulation is likely to change the German financial services distribution landscape
Markets in Financial Instruments Directive (MiFiD)
MiFiD regulation is likely to have a profound impact on the German financial advice channel
The European Commission suggests a regulatory 'pause' over the next five years
EC simplification project is likely to affect the insurance industry across Europe
CHAPTER 4 COMPETITOR DYNAMICS
Introduction
Key findings
The German financial advice market is dominated by 4 firms
The top four competitors in the German market are DVAG, AWD, MLP and OVB, holding 75% of the financial advice market there
The total revenue of DVAG, AWD, MLP and OVB amounted to more than EUR2.1bn in 2005
DVAG is the largest German financial advisory firm, measured by revenue, followed by AWD and MLP
DVAG enters into exclusive partnership with AachenMünchener
AWD closed its Italian operations because of a lack of profitability
MLP focuses on its core business following the sale of its life arm
OVB went public but majority stake remains in life insurers' hands
Broker pools are gaining popularity in the German advice market
Data Tables
CHAPTER 5 OPPORTUNITIES
Introduction
Key findings
The German financial advice market offers only restricted opportunities for new entrants but the market looks good for independent advice
Broker pools have gained increased popularity but the boom period is over
Germans do not embrace the idea of fee-based financial advisory service
Independent financial advisors have to find a niche to successfully compete in the German market
Retirement provision is the most prevalent issue in the German financial advice market
Independent financial advisors offer their clients mainly traditional investments
Data Tables
APPENDIX
Definitions
Research methodology
Further reading
Global Wealth Management SPP
Interactive Databases
Market Reports
Strategic Insight Reports
Wealth Management Competitor Tracker
Datamonitor Asia Pacific Wealth Management SPP
Savings and Investments SPP
Interactive Databases
Reports
Life and Pensions SPP
Interactive Databases
Reports and Briefs
Financial Advice Market SPP
SPP writing team
List of Tables
Table 1: Number of German intermediaries, segmented by group, 2005
Table 2: Total number of intermediaries, segmented by country, 2005
Table 3: German intermediaries, split by channel, 2005
Table 4: Distribution of life insurance products in Germany, 2005
Table 5: Key figures of Germany's top 4 financial advisory firms, 2005
Table 6: Shareholder structure of OVB AG, 2005-2006
Table 7: Top 20 financial advisory firms in Germany
Table 8: AWD revenue breakdown by geographical origin, 2005
Table 9: Top 10 broker pools ('Maklerpools') in Germany, 2005
Table 10: In your opinion, how relevant are the following topics in the market?
Table 11: Which products do you offer your clients actively and regularly?
List of Figures
Figure 1: There are currently around 500,000 financial intermediaries in the German market
Figure 2: Germany has by far the largest number of financial services intermediaries in Europe
Figure 3: Almost two-thirds of German financial advisors are single-tied
Figure 4: Distribution in Germany is slowly diversifying but is still controlled by the banking networks
Figure 5: The top 4 financial advisory firms in Germany were controlling 75% of the financial advice market in 2005
Figure 6: The revenue of the top 4 financial advisory firms in Germany increased significantly in 2004
Figure 7: DVAG relies on ""first-class products of strong partners""
Figure 8: In 2005 AWD generated almost 50% of its revenue outside its home market
Figure 9: MLP has subsidiaries in a number of European countries and also operates its own bank
Figure 10: BCA is the largest broker pool in the German market with a commission revenue of EUR66.5m in 2005
Figure 11: Retirement provision is the most prevalent issue in Germany
Figure 12: Traditional investments are the most offered products in the German financial advice market

Abstract

Introduction

This report gives an overview of the market for financial advice in Germany. It gives competitor numbers by firms and individuals, how much they sell of which products, and what opportunities the market presents to product providers going forward.

Scope

  • Analyzes the market for financial advice in Germany, including types of advisers, key products and leading associations
  • Encompasses both the German financial advice market and the wider issues affecting Europe as a whole
  • Contains detailed competitor information and analysis of current issues and opportunities
  • Offers a comprehensive evaluation of the key players in the market and the potential for growth


    • Highlights

    The financial advisory distribution channel in Germany is very large but truly independent advice is still marginal. There are currently around 500,000 financial intermediaries in the German market, most of whom are single-tied.

    The European Commission has introduced a number of regulatory reforms affecting financial services in the EU. IMD and MiFiD regulation are likely to have a profound impact on the German financial advice channel.

    The top four competitors in the German market are DVAG, AWD, MLP and OVB, holding 75% of the financial advice market there. The total revenue of these four players amounted to more than EUR2.1bn in 2005.

    Reasons to Purchase

  • Gain a comprehensive understanding of the size and scope of the German financial advice market
  • Obtain detailed and invaluable analysis of the competitive landscape and potential for market entry
  • Assess the importance of this channel for distribution strategies going forward


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